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Christmas Gift Guide
Tech Industry

Commentary: Pentium 4 delay will have little impact on marketplace

The short delay now expected in the introduction of Intel's processor may cost the company some December sales but is unlikely to have any strong effect in either the consumer or corporate PC markets.

The short delay now expected in the introduction of Intel's Pentium 4 processor may cost the company some December sales but is unlikely to have any strong effect in either the consumer or corporate PC markets.

Nor will it give competitor Advanced Micro Devices any real market advantage. The Pentium 4 is not likely to be a major player on business desktops. And consumer market sales have shifted away from high-end systems toward less expensive PCs that come with printers and other add-ons.

See news story:
PC makers report Pentium 4 delay
Based on talks with Meta Group clients, we expect PC sales to gather strength in the fourth quarter of 2000 and the first quarter of 2001 as large corporations begin to integrate Windows 2000 into their offices. The Pentium 4 delay should not affect those plans. We have been advising our clients to wait until later in 2001 to implement Windows 2000 on servers, where Pentium 4 processors will play a larger role. This chip delay just adds another reason to do so.

In the consumer market, AMD may gain extra sales to buyers of high-end systems because of the lack of competition from Pentium 4. However, PC makers will have difficulty changing their plans and retooling their production lines to manufacture more AMD-based PCs than they had planned for the Christmas market. In any case, we expect the shift in consumer purchasing patterns to continue, with most holiday shoppers focusing on the market below Pentium 4 regardless of the availability of high-end PCs.

Corporate users should not become concerned because of the short delay in Pentium 4 but should continue on their established timetable for introducing Windows 2000 across their desktops. If the delay continues, however, they may have to revisit their plans for adding Windows 2000 servers. Consumers who want the highest-end systems may need to choose between buying machines with AMD or other alternative processor suppliers or delaying their purchases for a while.

Meta Group analysts Dale Kutnick, Peter Burris, David Cearley, and William Zachmann contributed to this report.

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