IDC analyst Andy Brown said the price cuts, which often occur prior to chip launches in the new year, were a good opportunity to refresh PC assets.
"Businesses have become more prudent but this is a good time to buy," he said. "Prices are falling at the right time and users will get a good spec for their investment."
Intel has reduced the cost of Pentium 4 desktop chips by between 7% and 35%, with the 3.2Ghz Pentium 4 falling from £375 to £260, and the 3.2Ghz Pentium 4 for notebooks dropping 34% from £375 to £260. AMD has cut the price of its 3200+ chip by 25% from £270 to £203.
New generations of Pentium desktop and Centrino notebook chips from Intel are due, and AMD is moving towards production of 64-bit processors.