Intel has some very low-cost chips in the works for us, on top of an across the board price reduction. Intel's Pentium D 935 and Core 2 Duo E4300 are on their way, for fairly low prices of $133 and $163, respectively. The 935 uses the older, lower-performance cores, but the price can't be beat. It'll also drive the other 9xx series down in price. For example, the 915 will dip down to $93, a perfect range for those building low-budget machines. The slower clock of the E4300 is somewhat countered by the Core 2's impressive performance, so the E4300 may end up becoming quite popular:

The Core 2 Duo E4300 CPU line, which has a core speed of 1.8GHz and a 2MB L2 cache, with support for an 800MHz FSB, will be positioned to replace the existing Pentium D 945 series, currently priced at US$163 in 1,000-unit lots, the makers noted.
They're even looking to expand the Celeron line, including offering a 3.6GHz version with 512KB of L2 cache. Intel is definitely putting a lot of heat on AMD, with performance and price being offered to the market in a variety of forms.