a strong AMD lowers prices, a dominant AMD does not.
This is a concise way of summing it up. Static Relationship: Dominant vs Subjugate
Sure, when Intel has indisputably superior performing CPUs, you get relative bargains on AMD chips from time to time. Unfortunately, because they are generally inferior, they do little to affect the pricing of Intel chips. It becomes like any budget brand competing on price with a dominant brand (eg, Tide laundry detergent vs Gain). Sure, the cheaper product may end up being better value, but if you want the "best" you have to pay for it.Static Relationship: Equal vs Equal
If, someday soon, Intel effectively runs out of ways to improve performance increases with silicon-based X86 chips and AMD "catches up", then we'll probably see a duopoly develop. Both companies will go for years will little advancement. At some point, it will become detrimental to both to keep competing on price (ie, race to the bottom for profit) and in, effect, collusion (whether purposeful or not) as a baseline price becomes established. A good example of this are wireless/cable providers.Dynamic Relationship: Dominant/Subjugate vs Dominant/Subjugate
This is the best for the consumer. Every generation or two companies swap dominance. One company comes out with superior product, followed by the other coming out with something as good or better, for which it has to charge the same or less than the competition to regain market/mindshare. This is almost what we have with Nvidia and AMD on graphics. The companies are pretty dynamic in this sense on the low/mid-range gpus (though AMD is suffering a bit in mindshare/marketshare). Nvidia, however, has been dominant on the top end since Titan - much like Intel is now with x86 CPUs, allowing them to pretty much charge what they want for these halo products.