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AMD reacts to Intel, cuts prices

AMD maintains its vow to keep its processors at 25 percent below Intel, which earlier this week reduced prices.

Advanced Micro Devices this week reduced chip prices in reaction to price cuts from market leader Intel.

AMD has vowed to keep its processors at 25 percent below the nearest Intel equivalent. With these cuts, the Sunnyvale, California, company maintains its promise.

Under the new pricing structure, the 233-MHz version of the K6 will sell for $145, down 44 percent from $225, according to AMD spokesman David Frink.

The 200-MHz version of the chip will now sell for $92, down from $160, a 42.5 percent reduction.

Both of these chips are currently incorporated in sub-$1,000 PCs, most prominently in Compaq's new Presario consumer models. With the price cuts, consumer systems with these chips are expected to drop even more in price, possibly hitting new lows below the $800 or even the $700 mark.

On Monday, Intel announced price cuts across its processor line. The 233-MHz Pentium MMX was cut to $193 while the 200-MHz version Pentium MMX was cut to $123.

The 166-MHz version of the K6 chip was not cut and continues to sell for $84, since AMD does not expect to sell or supply many more of these chips, Frink said. The prices quoted are volume prices for computer vendors. Individuals buying K6 chips in a store will pay more.

While still struggling with manufacturing problems, AMD has been on a roll this year. In January, Compaq began to release consumer computers based around the K6. Virtually all of Compaq's value-priced desktops now use the K6, and Compaq has also elected to use the K6 in a laptop.

Frink did not provide pricing on the upcoming 266-MHz K6, which is due at the end of the quarter or early in the second quarter.