Intel to cut Core i3 prices to reduce overall Ultrabook price

According to eWEEK, Intel seems to consider cutting the price of some particular low-power chips in order to bring down the manufacturing cost of ultrabooks. Since the introduction of the ultrabooks, it has been a challenge for Intel to bring down the cost of these thin and light devices. The move by Intel also suggests an effort to better compete against Apple's MacBook Air, tablets and new systems coming out powered by chips from AMD.

Cody Acree, an analyst at Williams Financial Group, gathers from a report in the Chinese newspaper the Commercial Times, that Intel might cut the price of one of its ultra-low-voltage Core i3 chips by $25 to $27 to lower the cost of ultrabooks.

Since the introduction of ultrabooks, Intel has been trying to bring the cost down below the $1000 mark in order to compete against the MacBook Air. But recently we've seen tablets being offered at prices less than $500 and this seems to be a major factor in dampening ultrabook sales. On top of that, AMD is coming up with its new Trinity accelerated processing units (APUs) for low-cost and low-power notebooks termed "ultrathins" and they are expected to be sold for less than $500.

Acree believes that growing competition from AMD may have prompted Intel to cut the prices of ultrabooks. Also the fact that HP opted for AMD chips for its new Sleekbooks rather than Intel doesn't help it either. HP's move to go with AMD chips has allowed HP to offer the Sleekbooks for $700, which is significantly less than ultrabooks.

As per eWEEK, Intel officials have confessed that over 100 ultrabook designs are in the works and that they will be powered by the new 22nm Ivy Bridge processors, which offer better performance and power efficiency than last year's 32nm Sandy Bridge Core processors.

However, according to market research firm NPD group, ultrabooks has accounted for 11 percent of sales of Windows notebooks above the $700 price category and indicates a slow but steady gain in popularity. But, if Intel plans to enjoy a major share in the market then it will have to rethink the cost of ultrabooks.

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