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October 4, 1998

COMPAQ “USING ALPHA TO GET BETTER PRICES FROM INTEL”

By CBR Staff Writer

Sources at Hewlett-Packard Co are skeptical about Compaq Computer Corp’s commitment to the Alpha chip as its high-end processor. Although Compaq’s Tandem unit has now chosen to go to Alpha, HP thinks Compaq CEO Eckhard Pfeiffer is just using the threat of the Alpha as a stick to beat Intel Corp with. The HP source says it believes Compaq is fighting for better prices from Intel for the IA64 Merced chip, and points out that Compaq used chips from Advanced Micro Devices Inc for two quarters a while ago for similar reasons. Of course HP, a co-developer of Merced which is betting the company on its success, wouldn’t want to see the Alpha chip emerge as a strong competitor to the IA64.

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