I think Intel (and it's stockholders) can afford a price war less than AMD, now that they have no monopoly market segment. Unlike during past Intel screw-overs, AMD is competitive across all lines, so Intel can't just make up for their lost leaders in other areas. They can't hardly hurt AMD in flash anymore either.
As for the vaunted Intel low cost manufacturing using it's 65nm/300mm process, it sounds like AMD good yields will keep it's 90nm/300mm high end products competitive. And for the low end, AMD's use of Charter should keep costs down lower than Intel's. I recall when AMD was planning to team with UMC, they were expressing amazement at how cheap the Asians could produce. That didn't work out, but this time it looks like they will be ready......
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