Re: Intel as Gorilla
For competitive analysis class I wrote a game theory paper on the desktop PC semiconductor industry. The industry involved INTC vs. AMD, Samsung vs. Micron, and I tossed in my favorite Rambus as the oil that is the change agent in this industry. The result is that anyone who does not think Intel is a gorilla, is not looking very hard.
Admittedly, the market for INTC is slowing, as it is for Microsoft. But here are some definitions: Gorillas control the industry architecture; Monkeys mimic the Gorilla.
Pentium IV, first major new architecture change for INTC in five years (if memory serves).
Benchmarks demonstrate that the P IV with RDRAM sucks, is in fact worse than the P III and Athlon on memory and processor intensive activities IF the software is not specifically optimized for the P IV.
This is the catch. AMD has been playing catch up with Intel and getting darn good at making Pentium knock-offs. Further the current Pentium architecture was reaching the end of its life cycle. Intel could not continue to come out with faster and faster Pentiums on this architecture. So what happened, AMD gained confidence and began trying to develop its own high-end standard to develop as, if not a gorilla architecture, at least a very fat chimpanzee architecture.
What did Intel do, it changed the game, changed its architecture. The Pentium IV only works well with software specifically optimized for it. And when this software is optimized for the P IV is works about 2x as fast as the current high-end Athlon.
What does this mean? It means that all new mainstream software which wants to take advantage of the P IV's superior multi-media, multi-tasking, and other bandwidth intensive uses (such as voice recognition) will be written optimally for the P IV and not for any new Athlon that AMD will come out with.
So what is AMD doing? (1) they are backing down from a processor speed war (from an earlier post I made here demonstrating their capitulation) and (2) they have already announced production of a chip that mimics the P IV.
Conclusion: Intel has just changed the rules again, has set a new industry architecture, will continue to retain its 90% market share in the high-end, and AMD is once again, after a valiant fight where it gained some short-term momentum and hope (yet again) for AMD shareholders, is stuck, again, mimicking Intel and stuck in the lower margined discount aisle for processors.
Of course this doesn't cover the market for servers and communication chips. That is a whole new ball game which Intel may not hold gorilla power, but perhaps only king power. But this does not take away from Intel's obvious dominance in the PC markets. It is a gorilla in the PC. Whether or not this market will be beyond mainstreet shortly is another question.
Tinker |
