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Politics : Formerly About Advanced Micro Devices

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To: TimF who wrote (147757)	6/19/2002 4:56:40 PM
From: Tenchusatsu	Read Replies (2) of 1580486

Tim, <if AMD concentrates on just one area Intel can lower prices in that one area while making it up elsewhere.> If you haven't noticed, AMD is already dropping Duron. Watch as Intel raises the bottom on low-end CPU prices to compensate for the inevitable drop in server margins. The whole business model of AMD is to try and reach equivalence with Intel in some profitable market segment, then sell at a discount. As usual, this strategy is based on the hope that Intel would want to prioritize profit margins over market share. Wishful thinking, at best. This will be a case study of how NOT to build a strong business. My alternative? Start with marketing and cementing relationships with customers. Provide products and services that the incumbent won't want to provide. Make a small fortune that way, then expand slowly. Never start a price war with the incumbent; instead, defend yourself against any price war that the incumbent will wage against you. (Matching price drops is not a viable defense.) AMD might want to consider thinking outside the box if they want to survive this. Tenchusatsu

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