According to industry analysts, today's record low prices for fast PCs aren't going to be records for very long. Due to almost monthly innovations in processor technology, prices for top-of-the-line processors are predicted to drop, taking with them prices for other chips. Though companies like Intel may see profits margins shrivel in what is becoming a highly competitive marketplace -- where more and more chips are finding their way into machines costing less than $1,000 -- moves as simple as alterations in package design could allow the chip maker to offer even the fastest chips at significant discounts. And lower prices from Intel almost invariably result in price reductions from Cyrix and AMD, meaning consumers will be able to pick up increasingly faster computers for even less money. Pending advances in technology and changing product lines are expected to spark the price drop, with prices for Pentium II processors expected to fall even lower than current prices for Pentium chips. Intel will start shipping a new 333 MHz Pentium II "Deshutes" chips later this month, and a 450 MHz processor in the fourth quarter of this year. Though market pressures have forced Intel to charge less than ever for low- and mid-range processors, the company plans to introduce several high-end chips that will sell for more than $2,000. Sales of these processors, designed specifically for servers, will help offset decreased profits on other products. Propping up profits with specialized products isn't a new strategy for Intel. Last year, when competition nudged lot prices for non-MMX Pentium 200 processors below $100, Intel was able to sustain a premium price for the Pentium Pro. Neither Cyrix nor AMD has been able to duplicate the Pentium Pro line of processors. One thing consumers may not see when they buy new Pentium processors, however, is the Slot I cartridge. Though the architecture used in Slot I allowed for faster chips, the company reportedly has decided to scrap the design for all but the most expensive processors. But even the newest chips introduced in 1998 will no doubt find their way to the bottom rungs of the pricing ladder by 1999, when Intel introduces yet another line of MMX processors capable of operating at speeds in excess of 500 MHz. Shying away from tacking the traditional "II" onto the name of an already successful product, Intel has named the project Katmai. Katmai is expected to provide a huge boost to the multimedia capabilities of PCs, especially for applications running speech, 3-D graphics and video. Virtually any multimedia software package will benefit from the new technology. Initially, the Katmai instruction set will be seen only in Intel's best processors, but eventually all chips manufactured by the company will support it. As with MMX, it is likely that when the Katmai chip hits the streets in early 1999, virtually no applications will support it. That shouldn't stop a muscle-hungry consumer base from accepting it with open arms. But even with these advances in clock speed and architecture, Intel still faces some stiff competition. AMD has already begun shipping samples of it newest chip, code-named "Chompers," to its development partners. Chompers is AMD's first K6 3-D enhanced MMX processor and will boast an initial clock speed of 300 MHz. AMD says the new processor will deliver much-improved 3D multimedia experience when compared to any X86 processor on the market. Utilizing new instructions developed by AMD and supported by Microsoft Direct X and leading 3-D game developers, the K6 3-D will accelerate and enhance 3-D graphics, MPEG-2 video and AC-3 sound. AMD reports that it will license its new technology to competitors.