Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 250.10

-3.7%

Nov 4 3:59 PM EST

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To: gzubeck who wrote (219859)	12/9/2006 11:27:54 PM
From: economaniack	Read Replies (2) of 275872

gzubeck, the differences in APM and copy exactly are critical to understanding the different ramp rates, but not particularly relevant to the discussion of efficient scale for IO purposes. Intel does have a scale advantage in ramping a new process. Typically they develop the process on a production scale development fab, which becomes a production fab when development is complete, then they commit another fab to full time production more or less as soon as the product reaches release candidate stage. That means they are running lots of wafers at very low yields so they get meaningful quantities of chips relatively quickly, and they learn enough to get yields to acceptable levels fairly quickly as well. AMD does its early production by diverting wafer starts from current production, and so commits relatively few wafers to the new process. This means they have fewer production chips early in the ramp, and less information to fine tune yields and binsplits. They only really turn the dial on the new process when they begin to see decent results, and then improvements come quickly as do saleable volumes. So far the bottom line has not shown a huge advantage for Intel in terms of total cost, as their early advantages on the new process are balanced by its high cost and low yields. Of course at the moment they also have the advantage of a fresh core, while AMD is milking the 4 year old hammer. So Intel's ramp on a new process is more linear and AMDs has a classic exponential form, flat at first then going straight up before flattening again as the ramp completes. Add in that Intel is always at least months ahead at the beginning and AMD product at the new process seems hopelessly late. A couple months later and the new chips are everywhere and AMD gets to make hay for a couple months before Intel starts the process all over at the next shrink. Folks who think something has changed dramatically this time apparently weren't around for the .13 or 90nm shrinks which were pretty much exactly as disappointing as this one. After all the bruises and humiliation of owning this stock for ten years it is really frustrating to take grief because someone else's unreasonable expectations have been disappointed, especially when they were only ever strawmen for arguing that once again AMD is DOOMED. e

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