Intel Corp. launched its fastest Pentium 4 processor to date Monday and slashed prices on older models to help spur demand.
The new processor pushes Intel, which was beaten to the 1-gigahertz milestone last March by Advanced Micro Devices Inc., further ahead in the battle for faster computer chips, dangling new bait to get consumers to snap up new computers despite economic lethargy.
The new Pentium 4 is the first microprocessor to hit 2 gHz, or 2 billion cycles per second. Available immediately, it sells for $562 when purchased in quantities of 1,000.
Several computer manufacturers, including Dell, Hewlett-Packard and Compaq, launched systems incorporating the processor. Prices started at $1,499.
Also Monday, Intel cut prices on its 1.3 gHz, 1.4 gHz and 1.5 gHz Pentium 4 processors to $133 each–a decrease of up to 49 percent. Faster models also saw steep cuts.
AMD responded with its own reductions, including a 47 percent drop, to $130, for its flagship 1.4 gHz Athlon processor.
Though more efficient manufacturing techniques help make processor factories more efficient, both Intel’s and AMD’s bottom lines are likely to suffer in the short run during the price cuts.
Intel shares inched ahead by 7 cents, to $29.15, but shares of Rambus Inc., which provides dynamic random access memory for the new Intel chips, surged 30 percent, to $7.37, on the prospects of increased royalty revenue.
