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Price cuts nip at Celeron chips

Intel reduces the prices of several of its Celeron processors for desktop PCs, marking the chipmaker's second round of price cuts in two weeks.

Intel reduced the prices of several of its Celeron processors for desktop PCs over the weekend, marking its second round of price cuts in two weeks.

The chipmaker lowered prices for the chips, designed for low-price desktops, by as much as 24 percent late Sunday.

Intel typically reduces its chip prices on a predetermined schedule. Most often, it cuts prices to make room for new chips that it plans to introduce soon or to entice PC makers to move up the line to its faster processors.

This time, the largest price cuts came on Intel's newest 2.4GHz and 2.3GHz Celeron processors. All of the company's Celerons, except for the 2.4GHz version, now sell for less than $100 each.

Intel reduced the price of the 2.4GHz Celeron by 19 percent, from $127 to $103. The 2.3GHz chip saw the largest price decrease, falling by 24 percent from $117 to $89.

The Santa Clara, Calif., company also sliced the price of the 2.2GHz Celeron by 19 percent, from $103 to $89. Its 2.1GHz sibling slid by 11 percent, from $89 to $79.

The Celeron price cuts come at a busy time for Intel's desktop PC product line. They also follow a broader set of price reductions enacted last week. At that time, Intel lowered the prices of its 3.06GHz Pentium 4 processor for desktops as well as of several mobile Pentium 4 and Celeron chips.

In the near future, Intel is expected to introduce several new desktop Pentium 4 chips, including a new 3.2GHz processor that will become its flagship, and a new chipset, or group of supporting chips for desktop PCs, dubbed Springdale. These introductions will likely spark additional price cuts.

When the dust clears, Intel will have shifted its existing desktop Pentium 4 chips downward a notch in its pricing structure, making room for the newer chips.

After the Pentium 4 product introductions and related price cuts, Intel is expected to hold its desktop product line steady for a time while it works on its Prescott chip, a replacement for the current Pentium 4 that is due later in the year.