Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 208.32

+8.2%

Feb 6 3:59 PM EST

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To: mas_ who wrote (254866)	7/29/2008 6:56:45 PM
From: TimF	Read Replies (1) of 275872

There would be no serious reason to disable a working core as that would reduce the price that a die could reach. It would reduce the price that particular die would sell for. But depending on the exact balance of demand and production of working 4 core chips, it might still make sense to disable one core on a few of them. If to sell all of the 4 cores, they would have to drop prices 20%, but they can sell 90% of them without a price drop, and still make a reduced amount on the other 10% sold as three core chips, than it makes sense. I'm not saying this specific scenario is accurate. I don't even know if anything vaguely resembling it is accurate. I'm just saying something like that is possible. Of course you have to consider not just the price elasticity of demand for the 4 core chips, but also how well the segmentation works, if the three core chip you sell is just canalizing the sale of a 4 core chip (rather than taking a sale from Intel, or producing a new sale, or taking a sale away from a two core AMD chip which sells for even less) than AMD lost out on the deal.

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