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Politics : Formerly About Advanced Micro Devices
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To: Kenith Lee who wrote (109265)5/3/2000 8:40:00 PM
From: kash johal  Read Replies (4) of 1579161
 
Kenith,

re:motherboard company

There is NO need to do this.

There are several PCB and stuffing contractors out there already that folks like ASUS etc use.

The outlay for building 1M MB's would be in the $35 range excluding costs of chipsets which AMD was subcontracting to UMC.

$35-$50M in infrastructure investment to shore up a faster Athlon ramp is a modest financial risk that AMD should have taken.

The logic of doing this is so compelling to me that it raises questiions on the intelligence of this management - perhaps its so ego driven and can't respond to market realities.

They will invest $2bn 2 yrs ahead of time without a product or a market but yet fall down on some of the basics.

Another reason for them to do this was to subsidize the MB's. If you recall when they originally came out - they were priced north of $200, unreliable (remember MSI fiasco) and unavailable.

The Athlon acceptance would have been much greater if AMD had offered a $500 bundle including MB and processor etc in Q3 99.

But apparently they decided not to do it and they are paying a big price. The price is opportunity cost, and because expectations for AMD was so low everybody on the bandwagon thinks they are doing great.

The reality is AMD is doing some things exceptionally well, and some items are OK and some are simply stupid.

But c'est la vie.

regards,

Kash
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