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Technology Stocks : Advanced Micro Devices - Moderated (AMD)
AMD 212.49+5.7%12:18 PM EST
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To: milo_morai who wrote (18480)11/9/2000 11:56:47 PM
From: PetzRead Replies (2) of 275872
 
milo, I think no matter how many P4's Intel can make, it makes sense for AMD to flatten the price curve. If AMD's top Athlon is only $100 more than the bottom one, then OEM's will build a lot more of the top ones (initially 1.2 GHz, probably 1.33 before long).

First AMD's speed distribution is abnormally narrow right now, so their price range should be also. Remember, 80% in Q3 were 1 GHz or higher. Probably 90% now. I think 1.2 GHz is the speed limit for the 0.18 core because of heat, not because of transistor speed. Until Palomino comes out, the range of speeds will be narrow.

Secondly, it'll KILL Intel below 1 GHz. Why would anyone buy an 800 MHz Intel machine for $200 more than a GHz AMD machine? Because of this price pressure, Intel will raise the price of their P4's to maintain ASP's. The P4 machines will remain low volume, niche market and half the OEM's won't even want to build them.

Thirdly, having a 1.2 GHz 133 bus CPU will encourage the OEM's to build DDR machines which will more than match the performance of the 1.5G P4's. That'll speed up the buildup of the DDR infrastructure which becomes really important for the Palomino.

Finally, a $200 max OEM price for the TBird/Palomino pretty much guarantees that AMD will sell as many as they can make of them. That's the best way of guaranteeing a $90 ASP and a sellout quarter. They can sell quite a few 750 to 900 MHz Durons at $50-$80 and still hit the $90 ASP target.

Petz
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