Analysis: AMD mainstream CPU prices hit record lows in U.S. retail

Posted by Mark Raby

Columbus (OH) - Following a later than expected launch of the Athlon 64 X2 5600+ and 6000+ processors, prices of AMD’s mainstream CPUs have dropped to levels lower than we've seen over the past 21 weeks. AMD is in a critical phase where it needs to stabilize its processor prices and maintain competitiveness with Intel at the same time. Consumers are benefiting from a competition that is still heating up.

After a two week hiatus, we're back with our price/performance processor analysis and provide and updated look at the processor landscape in U.S. retail. We have updated our charts with AMD’s latest dual-core CPUs, the Athlon 64 X2 5600+ and the 6000+. Both processor aim at the very high end of the mainstream: Especially interesting is the 3.0 GHz 6000+ model, which runs at 125 watts and represents the highest performance AMD can squeeze out of its X2 architecture. This CPU will remain the flagship X2 processor until the arrival of the “Kuma” dual-core, which will debut in Q3 of this year.

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Both the 5600+ and 6000+ are prime examples for AMD’s tough market position: Average retail prices of both processors already are within 2.4% of the 1000-unit prices, which indicates that AMD is pushing these processors with hefty discounts into the market to regain ground in the $300+ segment of mainstream processor – an important segment that could lift AMD’s bruised average selling prices in the desktop segment. The 5600+ carries a (1000-unit) tray price of $326; the average retail price is $334, according to Pricegrabber.com. The same story goes for the 6000+, which has an average U.S. retail price of $474, whereas the tray price is only $10 less, at $464.

On the heels of the new processors, which are just above what might be considered the mass-market mainstream level, the less powerful AMD dual-core products all dropped in price this week.

In fact, for the 21 weeks we've been collecting processor price data, today marked the lowest price we've seen for each of the following: 3800+, 4200+, 4600+, 4800+, and 5000+.  It's particularly of note that the X2 processors are the ones that saw new record low prices, since they're in the same line as the two new entrants.  The 4400+, which at one point dipped down to $209 in December, was the only X2 processor on our list not to fall to a new record low. (However, keep in mind that we currently do not have sufficient data to break out 65-watt processors from the list, which are typically more expensive than the outgoing 89-watt models.)

Also worth noting for AMD concerns is the FX-74, which is available in pairs for the firm’s dual-socket platform.  AMD's top-end processor has actually been on a downward trend for the past six weeks.  On January 19, we noted the price as $1211.  Since then, it's been continuously falling to where it is now, at $1075.  This brings it sort of close to the $999 tray price, and for the first time it actually undercuts Intel's EX6800, the processor enthusiasts will compare it to.

While we're on the subject of Intel's high-end processors, we should mention the QX6700.  We were kind of surprised when the retail price fell below the $1000 tray price on January 5 and then again on February 16.  However, this week we saw the biggest week-to-week price jump we've ever seen for the QX6700 since it launched in November.  Today's $45 jump brought it back from $990 to $1035.  We haven't seen a price that high for it since December. 

On the other hand, if you are on the lookout for an entry-level system, perhaps to run Windows Vista, Intel’s Pentium D series could get much more interesting over the next few weeks. Over the past few months, the trend has been that most of the retail prices stay very still. However, we are hearing that Intel is planning price cuts for these processors. Plus, Intel has been ramping down 90 nm processor (Pentium D 800) for some time and has been shifting 65 nm capacities from the Pentium D 900 to the Core 2 Duo family. As the Pentium Ds vanish from the market over the coming weeks, expect to find some good deals in this segment.

As AMD tries to lift off the pressure mounting from Intel on the higher-end of the mainstream, Intel hypothetically could pull the rug out under AMD and drastically slash its low-end processors.  Since this is the part of the market that AMD is currently cornering, it would give Intel another leg up over its competitor.

This week, we saw a $65 decline in average retail pricing for the Pentium D 840, a 15% drop from $432 to $367, which makes it the least expensive we've seen it over the past five months. It wouldn’t be too much of a surprise, if we saw similar developments with most of the Pentium D processors over the next several weeks, so it's worth keeping an eye on.

 

Read on the next page: Price/performance analysis of AMD and Intel desktop dual-core processors 

 


 

Price/performance analysis of AMD and Intel desktop dual-core processors

 

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Graphically, the addition of the 5600+ and 6000+ did not have a huge impact on AMD’s processors in our chart.  They actually fit right in with the previous AMD processors, which indicates that they are priced just in line with all other X2 processors.  In the graph, we can see that they actually don't really compete with Intel too much because Intel doesn't not have multiple processors with the comparable level of performance. (We need to note that we are still waiting for benchmark data for Intel’s Core 2 Duo E6300 processor, which we will provide as soon as it is available to us.)

An interesting development that is highlighted by our charts is the fact that AMD is taking more and more charge of the low-end and high-volume segment of the dual-core processor market at this time. For the first time, we can see that every single processor up to the 5000+, looking at performance, is less expensive in average retail pricing than all the Intel CPUs in or around the same level of performance.

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We have mentioned before that when we cut Intel into Pentium D and Core 2 divisions, AMD ends up getting sandwiched between those two processor families.  That is especially the case this week.  With the exception of the 5000+ and the E6400, which are touching each other on the graph, the three different sets of data are completely separated from one another.

Since it's the only processor for AMD with such a high performance level, the FX-72 has a huge impact on the high end of AMD's trendline.  If it continues to fall in price like it's been doing for the past six weeks, it could actually start putting pressure on Intel on the high end.  This is certainly something to be watching over the next weeks.