Hi Joey,
Been busy lately and haven't had the chance to read through all the short term "anyone have any idea why Intel is down or up 1/8 in the last five minutes?" crap. I think I really started finding it hard to participate in this thread when the tone turned decidedly away from news, fundamentals, innovations, etc. to star gazing and crystal ball forecasting ala Archie.
<<What is your take on the Compaq/Cyrx venture? Do you think CPQ's brand name will offset Intel-Inside, and people wont care if its a cyrx chip inside as long as its a compaq? Do you see this as a fair/significant test for Intel's Intel Inside brand?>>
First let me say, I would be much more concerned if DELL or GATE broke ranks. It has been my opinion for about 4 years and continues to be my opinion that the direct channel (with the big 3 being DELL, GATE, and MUEI) is/has been becoming the channel of choice for PC sales. The largest future growth will continue to be in this channel and will come at the expense of the traditional players who simply don't have the cost structure to compete against the "build to order model" used by the mail order houses. This will be especially true as all PC vendors experience margin pressures in the future. GATE and DELL built empires with much lower margins than the industry is currently experiencing and they will be in a better position to compete in those conditions when they arise again.
As for the Compaq/Cyrix deal specifically. I do NOT think that the Compaq logo will carry more weight than the Intel Inside/Pentium/MMX logo and I think Compaq will ultimately realize that trying to push an unknown second class chip isn't worth the extra margin, especially when Intel Inside sells itself. Indeed, I do think that this WILL be a very good test of how successful the Intel Inside/Pentium campaign of the last few years has been. I think Compaq has underestimated the demand for Intel Inside and overestimated their own logo. They have also put at risk their reputation by offering what many will see (whether real or perceived) as second rate boxes. If Intel wins the fight to keep MMX a proprietary trademark, it will deal a tremendous blow to Cyrix, AMD, and any current or prospective Cyrix/AMD OEMS.
I think that most Cyrix/AMD supporters continue to underestimate Intel's marketing skills which, like their chips, is world class. They continue to confuse the ability to manufacture competitive products with the ability to sell them. Cyrix and AMD will continue to have their niche, but that's all. As far as the short to intermediate term at the very least, they are a non-event as far as Intel's financials are concerned. Cyrix and AMD are competing against each other not against Intel. Many Cyrix and AMD supporters either don't understand this or aren't willing to admit it. Cyrix and AMD will continue to fight for the crumbs that Intel is leaving behind at a measured and controllable pace. Too few crumbs brings in Uncle Sam if you know what I mean. There is the possibility that Cyrix and AMD can survive along with Intel but I have my doubts about Cyrix. At any rate, IMO this notion that either is going to take away significant share form Intel is simply an old tune that I have heard over and over again, and while many Cyrix/AMD supporters claim that things are different this time, I think things are more the same than different. The only thing different is that now Intel is stronger financially, Intel has a stronger brand recognition, Intel has more products in the pipeline, Intel has better product mix (i.e. selling more higher end higher margin chips) and Intel has in place a much more aggressive marketing campaign.
Good luck to all,
FF |
