Intel went ahead with a series of price cuts, likely to be the last before Christmas (see Newswire 23 October).

The cuts will push higher performance Pentium II chips further into the mass market, with the Celeron low end family de-emphasised. Several lower speed chips have disappeared and, although there is still some price advantage for Celeron, the gap between the 'Basic PC' line and PII has narrowed.

Intel, which has seen PII based machines succeed in price sensitive markets while Celeron's performance has been less glorious, said: "Continued strong acceptance of Pentium II processors enables Intel to strongly ramp these products into higher volume price points."

The biggest cut is 30 per cent on the 350MHz PII, which falls to $213. The 333MHz, the new entry level, is down 23 per cent to $181, and the 400MHz and 450MHz down 22 and 16 per cent respectively, to $375 and $562.

The Celeron 333MHz 128Kbytes cache version loses 17 per cent to $159, and the 300MHz only seven per cent to $138. Celeron is now positioned for markets of extreme price sensitivity where running Intel rather than budget processors is still essential.

The PII Xeon server chips also saw cuts - the 400MHz with 1Mbyte of cache down 30 per cent to $1,980, and the 400MHz with 512Kbytes cache down 27 per cent to $824, the same price as the 450MHz version of the same chip. There were no cuts on the PII/mobile and Pentium mobile modules, where Intel's position is more secure.