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Technology Stocks : Advanced Micro Devices - Moderated (AMD)
AMD 223.44+4.3%Jan 2 3:59 PM EST
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To: Tenchusatsu who wrote (241845)10/5/2007 12:07:48 PM
From: pgerassiRead Replies (1) of 275872
 
Dear Tench:

Get off this $14.89 estimate per PC. Like most, it fails to consider cumulative effects like by illegally interfering with AMD sales, it deprived AMD of money to expand its fabs. Thise fabs would have generated more CPUs, increasing its share which then makes AMD more money money and begines the cycle again. After 5 years that doubles its share.

Those effects of compounding are typicaly missed by those estimates. Factoring those in, the illegal tactics to expand the monopoly cost far more than $14.89 a PC. Given desktop and mobile prices, its more like $100-200 a PC.

And it reduces the speed of innovation. The tactics probably delayed the release of faster and more innovative processors. And these rebates didn't really translate into lower prices as they inflated the OEM's pockets, like Dell's. Favoring one vendor over others causes the price to be higher than necessary.

Anything illegal tactic that increases the overhead also causes the resultant prices to rise to cover it. So the legal monopoly might have caused the prices to rise per PC by $14.89, although that is probably low, the illegal tactics costed far more, $100-200 each.

Pete
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