SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Intel Corporation (INTC)
INTC 39.11-0.6%11:09 AM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Mary Cluney who wrote (138993)7/10/2001 10:24:42 PM
From: kash johal  Read Replies (1) of 186894
 
Mary,

Several comments.

1. $60Bn market figure.

This seems very reasonable. Sun alone is a $20Bn/yr company with majority of their sales as servers.

2. You are way overestimating impact of itanium in $ sales IMHO.

The same high performance CPU will go in several market segments for several suppliers ranging from single CPU workstations to very high end servers. The key is that this will drive higher volumes and lower CPU prices.

I can see Intel having itanium chip sales in order of 1M units/yr with ASP of $4K max in a 3-4 few years which translates to $4bn in revenue. Profits on these chips may reach 25% or close to $1Bn/yr.

Thus it can be a great business but nothing like the overall size of Intel which is a $30Bn business today and likely to be $40-50Bn in 3-4 years.

Perhaps another way of explaining it to you is to look at SUN.

Their highest performance CPU in their low end workstations which are priced around $5-10K (SUN BLADE 1000 family).

The same chip will be used in $1M plus systems as well(in fact their highest $$ systems are still using slower older generation chips).

The value of the CPU's in the server market will DECREASE because system houses will use industry standard CPU's.

So inherently for Intel to succeed they must offer reasonably compelling value.

Now lets suppose they price their chips at $10-20K each.

Folks like Sun, IBM will wipe HP,CPQ,Dell etc out in the server market as their inhouse systems will be much lower cost.

regards,

Kash
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News