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You have to remember that this will be the slowest Bloomfield CPU. It will have unlocked multipliers and you'll be able to adjust the speed of the QPI. The Lynnfield processors are a different matter altogether, as they will be locked to prevent overclocking.
It might actually be even cheaper, some rumours says US$266. The 3.16GHz XE version will still come in at US$999 or maybe even more.
It's not a performance failure, it's a matter of Intel wanting to build up a user base for its new platform and what better way of doing that than offering an affordable processor?
Time will tell how well Bloomfield is recived, but I'd get one over a Lynnfield processor any day.
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