peter:
"An ABSOLUTE must read!!!"
Thank you...An comprehensive overview of hurdles in front of the P4...Seems it might be a while, if ever, before the P4 can free itself from the "tar pit" in which it currently finds itself...Some startling quotes from the "must read" follow:
"PC100 was introduced on performance PCs when the fastest CPUs were running at 400MHz. It was replaced by PC133 by the time CPUs hit about 800MHz. Now Intel expects the market to get excited about PC100 performance on a 2GHz platform. We think Intel is going to experience yet another horrific market backlash on this one.
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"After all of this, our intent is still the same - to evaluate the road ahead for P4. It seems that the jury is still out. At some point the P4 will entirely replace the P3 in Intel’s product mix, so Intel will be free to declare it a success at any time, on its own terms. But will Intel continue to lose market share along the way due to its frustrating and confusing platform strategy and performance profile?
With application throughput confounded by its core processor architecture, external bus irregularities, and thermal regulation compromises, the Pentium 4 presents an unfamiliar and seemingly unbalanced performance spectrum. Worse still, the P4 is weakest on the core applications that have thus far driven mainstream PC usage and sales demand.
With an oversized die, production capacity per wafer is reduced by about 60% relative to the P3. Intel’s near term P4 ramp is constrained by its ability to bear these elevated costs. Now, the P4 must undergo horrific premature price slashing in order to sustain any hope of popularity in the market.
Intel’s dependence on Rambus for the Pentium 4, serves as a major barrier for widespread acceptance in business domains. Pricing, availability problems and a recall fiasco have branded RDRAM as an unattractive path in the minds of many corporate buyers. Few IT managers want to spend their budget, or risk their reputations on technology that burned them only a few months ago.
In light of these issues, the P4 motherboard sales shortfall begins to make sense.
Although the move to Northwood and third party chip sets will help alleviate several of these problems, other issues arise. Not only is Intel moving to a new 0.13 micron process with Northwood, but this process utilizes copper technology that is foreign to Intel. We cannot help but wonder if Intel’s pronounced aggressive ramp of this process is a bit over-ambitious. We can’t help but wonder if 0.13 micron copper wafers and chips will be in short supply until 2002.
Finally, as the industry creeps toward a cautious economic recovery, circumspect consumers will first seek refuge in the low risk value segments. We expect an upswing of demand in the low-end segments in the latter half of the year. Unfortunately, high dollar P4s will be left on the shelf.
At the opposite end of the spectrum, the dot-com collapse has taken the wind out of the sails of the server market – but not to the same extent as the rest of the market. P3 platforms are in desperate need of upgrade and the P4 provides an excellent solution, aided by ServerWorks. The ramp to production is expected to begin late in the year though, and volumes cannot compare to the mainstream markets.
So, can the P4 recover? This year looks bleak. Expect continued margin erosion and declining ASPs. The erosion of market share to rival AMD will endure relatively unabated, and expect upstarts VIA and Transmeta to also make more gains at Intel’s expense." |
