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Bruised but not broken, AMD fires off another volley of price cuts across Core 2 Duo's bow

With only a month until the most anticipated AMD product launch in five years, the company is pulling out all the stops to get competitive before the Back to School buying season.

The AMD-Intel price war, now almost into its second year, was cited as one of the contributing factors to the $611 million dollar loss AMD posted in the fiscal first quarter of 2007.  Following that loss came a 400 employee headcount reduction and a $2.2 billion cash-for-stock deal.

Almost immediately after posting its Q1 loss, Mercury research declared that Intel managed to recapture all of AMD's marketshare gains from 2006 in the first three months of 2007.  JP Morgan directly attributed the Intel traction due to aggressive pricing.

Effective Monday, July 9, 2007, AMD will enforce the following pricing among its channel:

AMD Athlon 64 X2 Pricing

July 9








With these new prices cuts, AMD will also significantly trim its retail CPU portfolio.  All single-core Athlon and Sempron models currently in the channel will officially reach end-of-life status (EOL).  The ultra-low cost Athlon 64 3500+, Athlon 64 3200+, Sempron 3500+ and Sempron 3200+ will continue to exist in high growth markets: Brazil, Russia, India and China.

In addition, the Athlon 64 X2 3800+ and 3600+, currently priced at $79 and $69 respectively, will also reach EOL status.

AMD roadmaps confirmed that other low-cost single-core processor families like Lima have already been phased out, just three months after launch. The company is still slated to introduce its 65nm Sparta family, based on the K8 architecture, in September 2007. 

The company's next-generation architecture, occasionally dubbed K10, will officially launch the last week of August for server platforms, and sometime late in the holiday season for desktops.  AMD has not issued pricing notifications on these processors yet.

AMD fired the first volley at the Intel price war when the company dramatically slashed processor prices -- just days before the Intel Core 2 Duo launch.  Since then, both companies reduced pricing of last year's products to less than 33% of last year's street price.

Memos released to DailyTech from AMD distributors confirm that the July 9 AMD price cuts are directly aimed at pre-empting the July 22 Intel price cuts.  These upcoming Intel price cuts will cut current Intel quad-core almost in half.

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RE: No hope...
By fenderkb76 on 7/8/2007 10:38:38 PM , Rating: 3
I'm glad someone is talking sense here. Like someone else said, I'll always have a soft spot for AMD, just like most of the sports teams I follow are underdogs and overachievers.

It's a shame that AMD never had the market share and deep pockets of Intel. I'd say they handily pounded Intel in terms of price/performance for 3 years. However, Intel is the 800 pound gorilla who could have taken that treatment for another 5 years without problems, especially with their brute-force marketing and "incentives". Because of the size of Intel and their "installed user base", they were able to completely turn the clock back to pre-K7 days in a matter of months once they created a superior product.

It really is a shame for AMD although it is good for consumers overall. However, if the trend continues, Intel won't be competitively priced a year from now. I hope AMD can make it to the next generation with enough resources to make something "revolutionary" vs. "evolutionary".

What's funny is that right now, I see much more exposure for AMD now than I ever have. Look at a Best Buy or Circuit City ad in the Sunday paper. I dare say that more than half of the PCs and laptops feature AMD CPUs. For crying out loud, Dell even sells them!

RE: No hope...
By InternetGeek on 7/8/2007 11:32:04 PM , Rating: 1
I've owned AMD only once in my life. It wasn't a bad experience and at the time benchmarking wasn't mainstream. The PC then was a 486DX2 or something like that.

Since then I've simply bought the fastest CPU I could get (best price/performance ratio) every 4 years or so. By pure coincidence Intel has always gotten my money because at the moment I was shopping Intel had the speed crown or was so close to the top the price difference wasn't worth it. The PCs, at their respective time, were Pentium 66mhz, Pentium 600Mhz, 2.8GhzHT and currently, after jumping into laptop realm, a Core Duo 2.8Ghz.

My next buying cycle is in exactly 2years. I will buy a 'gaming' laptop because they can let me play and program without much hassle.

It would be nice to try out an AMD, but historically, Intel will have the speed crown then.

Perhaps Intel simply knows how to time their products according to market trends, putting out their best when most of the people are updating. But that would be a gross generalization.

“Then they pop up and say ‘Hello, surprise! Give us your money or we will shut you down!' Screw them. Seriously, screw them. You can quote me on that.” -- Newegg Chief Legal Officer Lee Cheng referencing patent trolls

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