roni - Intel price cuts
re: www.investorshub.com/boards/read_msg.asp?message_id=11197959
It was interesting but I never quite know what to make of the price quotes for thousands quantities compared to contracts that Apple may have with Intel. It is common for someone the size of Apple to make some mid-to-long term contracts for an average price over a time frame. So, instead of paying, say, $200 the first Q of shipment, $150 the 2nd Q, and $100 the 3rd Q, they just sign up for $150 for the first 3 quarters. Somewhere in that timeframe, they re-negotiate the price and timeline for the next contract. So these price dips may not translate into immediate changes for Apple.
Those contracts can have all sorts of sidebars in them. Big players can contract for X amount per Q, and also have the option to take Y% more at a predetermined price. Without those options in the contract, they might go back for more volume for a hit product and be told 'Ahhh, we delivered what you asked for, now we are out of capacity, you will need to pay a premium if you want a quantity higher than what you contracted for'.
Still, a downward trend in pricing from Intel is a good sign that Apple can lower prices as time goes by. It might not help much in the comparisons with Dell, but it should help to trigger upgrades among the Mac Faithful.
-KCMW
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