Re: I'd like to hear comments from all regarding the pros and cons related to the impending AMD price cuts, and especially on what AMD is trying to accomplish with these price cuts
Well, first of all, you've once again done a better job graphically presenting data using only ascii text than most people can do with Powerpoint. Thanks for the DD!
Assuming that real prices charged to OEMs and distributors reflect these prices, I think you are right that 500-600 are end-of-life and they'd rather sell a 700 than a 650 (your graph makes that very clear!)
650 on up looks like a log scale! IMHO this pricing reflects marketing goals, not production constraints - the gap that once appeared beyond 650 is gone. Could this indicate that AMD is settling in for the long haul, and expects Intel to finally be able to fabricate the CPUs they sell in volume? Previously, the market was in an artificial shortage situation above 650, now the pricing seems to indicate a normal market through the whole range.
Possibly, previous pricing reflected a couple of things; AMD is a (relatively) small, (relatively) undercapitalized company, that was unable to supply its customers with promised K6-3 parts a year ago, so that one of AMD's biggest risks has been, paradoxically, too much demand.
Any appearance of inability to produce would have been disastrous to AMD. With Intel hyping speeds they were unable to produce at the volume demanded, a sudden large shift to AMD would have been both temporary and disastrous. Given the conservatism of most corporate IS procurement staffs, real near term demand for AMD high end parts is limited, so AMD shouldn't, and hasn't, put into place capacity to satisfy such demand. Had the temporary vacuum at the high end due to Intel's problems been permitted to divert a brief burst of demand at AMDs high end (by maintaining pricing that didn't take into account Intel's problems), AMD could have found itself looking unreliable.
Since AMD has enjoyed plenty of success with the Athlon in the 500 - 600MHZ range, where PIII has been, if anything, in oversupply, progress should continue, or even accelerate, now that rationality has returned to high end pricing.
Or maybe this is just where the darts landed this month :-)
Regards,
Dan |
