varri@korppi.tut.fi (V{rri Alpo) (11/25/90)
The press has been talking about non-Intel fully compatible 386 chips which should be coming to the market soon. If this is true, will it decrease the price of 386- (486-) PCs significantly in the near future? Are there any compatibility problems expected with the non-Intel 387s? Are there other factors which might cause the prices of those PCs to decrease considerably soon, i.e. is it worth while to wait e.g. till February before buying. Alpo Varri
john@newave.UUCP (John A. Weeks III) (11/29/90)
In <1990Nov24.193921.28119@funet.fi> varri@korppi.tut.fi (V{rri Alpo) writes: > The press has been talking about non-Intel fully compatible 386 chips which > should be coming to the market soon. If this is true, will it decrease the > price of 386- (486-) PCs significantly in the near future? I think not. Two reasons. First, I have heard that Intel intents not to sell 486 chips to any company that uses clone 386 chips. Will any big time computer companies dare to cross Intel and risk thier future? Second, even if you are brave enough to use the clone 386's, why would you price your machine much below anyone else's machines? Your objective would be to have a price advantage yet make as much as profit as possible. > Are there other factors which might cause the prices of those > PCs to decrease considerably soon, i.e. is it worth while to > wait e.g. till February before buying. Now that we are officially in rescession, expect prices to stabailize or increase mildly. One way you might get a really cheap 386 is to look for some computer manufacture to go belly-up. IMHO. -john- -- =============================================================================== John A. Weeks III (612) 942-6969 john@newave.mn.org NeWave Communications ...uunet!rosevax!bungia!wd0gol!newave!john ===============================================================================
kurt@tc.fluke.COM (Kurt Guntheroth) (12/08/90)
>> In <1990Nov24.193921.28119@funet.fi> varri@korppi.tut.fi (V{rri Alpo) writes: >> Will [non-intel 386 chips] decrease the >> price of 386- (486-) PCs significantly in the near future? > I think not. Two reasons. First, I have heard that Intel intents not to > sell 486 chips to any company that uses clone 386 chips. Will any big time > computer companies dare to cross Intel and risk thier future? OK, so IBM and Compaq don't have the guts. These guys aren't price leaders anyway. Maybe there are companies in the next tier (Dell, IDE) willing to bet that (1) 386 is enough to be in the market (2) Intel wouldn't dare (3) the same folks who cloned the 386 will clone the 486. Then there's the third tier of manufacturers who will go in business just for the short term buck. PCs are already a commodity business at the low end, and there are many commodity manufacturers willing to play. Face it, it just isn't that difficult to build a PC any more. > Second, even > if you are brave enough to use the clone 386's, why would you price your > machine much below anyone else's machines? Your objective would be to have > a price advantage yet make as much as profit as possible. Because if you have $100 dollars of headroom in your pricing, so do your competitors. You take $1 off the cost and they immediately take $2. Then you take $3, etc. This is Economics 101 stuff. The fact that their is competition in the processor finally keeps artificial shortages from being engineered, keeps intel from punishing the disloyal or rewarding the loyal, and generally encourages a simple supply-and-demand economy to exist. > Now that we are officially in rescession, expect prices to stabailize or > increase mildly. One way you might get a really cheap 386 is to look > for some computer manufacture to go belly-up. IMHO. Small clone makers with no manufacturing capacity of their own will disappear, reducing competition and driving prices up, but the big companies will still be there churning out boards. A company with a manufacturing line in place need only recover the variable cost of manufacturing PCs. Even if they can't make a profit, they will lose money more slowly if they continue to build and sell. This drives prices down. I wouldn't care to guess which factor is bigger in the marketplace.