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Politics : Formerly About Advanced Micro Devices

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To: RDM who wrote (54713)	4/8/1999 4:45:00 AM
From: Tenchusatsu	Read Replies (1) of 1575422

<That is a good point. 2 million K6-2 not shipped are $150 million. They are still $180 million ahead.> Problems abound with this theory. First of all, a 2-to-1 ratio of K6-2 units to K7 units is coming from die size alone and assumes that the yields on each chip will be the same. Witness how slowly the K6-III is ramping up, and it's safe to assume that yields for the K7 will be just as low, at least for a quarter or two. And second, even if AMD ramps the K7 production at superhuman speeds, would it be that easy just to walk away from the sub-$1000 market? Tier 1 OEMs are expecting AMD to continue to supply them with el cheapo K6 chips so that they can continue to set their prices pennies below their competitors. In other words, was AMD a little too successful in carving its own low-end niche that it can't climb out? Seems like the K7 production will flounder until AMD can get the 0.18 micron process up and running, i.e. the Dresden fab. That comes at least two quarters after the K7 release, meaning that the real money is further out than once anticipated. Tenchusatsu

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