IDF 2013: Intel Announces Holiday Price Tiers, Starting WIth $99 Tablets
September 11, 2013 5:45 PM
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Intel promises low prices -- but will OEMs listen? And more importantly, does OEM believe in its own message?
Intel Corp. (
) has a pretty interesting pricing strategy that it's revealed at the
2013 Intel Developer Forum
(2013 IDF). Three messages can be taken away from the pricing Intel has revealed.
First, it is a great time to be a PC buyer -- if you're interested in an Intel PC. Prices on Intel equipped PCs -- which will start at $99 USD -- have never been cheaper. Second, Intel has to be compromising its
famously high margins
to hit these price points (you'll agree when you see them). And third, for the first time Intel has a clear tiered price hierarchy in which price is (somewhat) a function of utility and processing power (seemingly a fair deal).
For the holiday Intel is targeting
price points of:
$99 USD for
$199 USD for "clamshell" (e.g. traditional budget) laptops (Bay Trail or Celeron)
$299 USD for "2-in-1" laptop-cum-tablets (flip, slider, detachable, or swivel form factors) (Bay Trail or Celeron)
$399 USD "Ultrabooks" with Core series chips
The big question is whether OEMs will cooperate with these aggressive prices. After all "starting at" by no means says that all -- or even the majority -- of OEMs will offering product at these prices. Intel had
promised very low ultrabook prices in 2012
-- and it
largely failed to deliver
on those promises. What's even more troubling in the present context, is that Intel itself seems somewhat conflicted about its commitment to budget pricing.
For its past two keynotes it emphasized low, sub $400 price tiers. But at the
deep dive semi-technical section, Intel's Mobile Vice President Herman Eul commented:
Our customers are not looking for the cheapest thing they can find. What they are looking for is the best thing they can afford…. This is the way for Bay Trail to close that gap as it delivers performance in multiple segments.
A $99 USD tablet certainly sounds cheap. So the question is which direction Intel is truly committed to -- budget tiered pricing or "the best thing [the consumer] can afford." Intel -- who has long struggled in the tablet market -- has traditionally adopted the latter philosophy. Now as it throws in budget pricing rhetoric one must wonder whether it's changing direction, or merely adding a bipolar sales message to an already struggling campaign.
It's possible that Intel will be able to tread the line have sell to both the high and low end in the tablet/2-in-1/laptop market. But if it slips, these mixed signals could come back to haunt it.
[All Images (c) Jason Mick/DailyTech LLC, may be used with citation]
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Poor track record
9/13/2013 11:47:17 AM
Starting with netbooks several years ago and Ultrabooks since early 2012, Intel has been boldly predicting much lower prices than what OEMs actually shipped.
When netbooks first came out, instead of the <$300 prices Intel had been predicting, they were priced by OEMs at $400-$500 (hoping buyers would think they were just as good as laptops). In 2008, it was reported that netbook prices "might well drop by the holidays to $249". Then in 2011, "Intel said it has introduced a new Atom processor to bring down the price of netbooks to under $200".
Did anyone ever see a netbook for under $300 ? No! This all seems like just wishful thinking by Intel and marketing buzz. Why would it be any different this time around ?
RE: Poor track record
9/14/2013 7:24:14 AM
What are you talking about? Netbooks have been $199 for years. It was possible to pick them up for $99 on sales or with coupons.
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