AMD Drops Prices Ahead of '4x4' Debut

Finally making the move analysts have long anticipated, AMD released an updated price list this week, dropping the processor-in-a-box (PIB) price for its premium FX-62 high-performance processor by 14%, to $713.

As a result, street prices for the FX-62 have fallen to as low as $679.50, based on data collected this afternoon from PriceWatch CPU, which is 4.4% lower than its street price at this time last month, and over one-third lower than just prior to Intel's release of Core 2 Duo last July.

At the same time, AMD formally introduced the Athlon 64 X2 5200+ desktop processor into its product line, with a PIB price of $403. But that price might be significantly lower than its street price, once those sales are finally recorded. AMD's PIB price for its 5000+ model have stayed steady at $301 since last July, although its sales price continues to hover well above the $400 level - at $433 today, according to PriceWatch.

In recent weeks, AMD street prices have not been falling at the same rate as Intel's, resulting in AMD's price/performance lead slipping in the "value" segment of the market. Intel Core 2 Duo street prices are down about 8% over this time last month, while street prices for AMD's non-discontinued dual-core processor lines have mainly held steady until this week.

As a result, the price/performance curve between the two companies has shifted, with Intel gaining back some of the advantage. In September, processors selling for about $450 and below were generally better performers if they carried the AMD brand; those above that range were better performers for Intel. Today, that crossover point has slipped to about $375, which now serves as the fence dividing AMD's leadership territory from Intel's.

The FX-62 has been a problem point for AMD, selling for an artificially high amount, up over $1,000 last July. For significantly lower, customers could purchase AMD processors with only marginally less performance. This week's cost cutting move helps AMD remove some of the artificial nature of that premium, and gives the company more room to price its forthcoming '4x4' double-dual-core processor units more competitively.

What does AMD's choice of $403 for its new 5200+ model tell us about its relative performance in the company's CPU scheme? At that price, on AMD's current price/performance curve -- using performance figures obtained from very reliable, independent sources -- the 5200+ should be an equal or slightly better performer than the Athlon FX-60, which AMD officially discontinued a few months ago.

The street price for the FX-60 is currently $549.50, according to PriceWatch data, so the 5200+ could be a bargain if its street price stays around $450, or especially if it hovers closer to its PIB price, as do other AMD processors.

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