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To: kash johal who wrote (25485)	7/22/1999 12:53:00 PM
From: Dave B	Respond to of 93625

Kash, Yes, and if they were going to charge more than Intels chips I would say they have no chance against the established competitor despite the higher performance. And it won't work if they try to charge less, either. In the long run, this strategy never works against an established competitor (unless the competitor lets you do it, and Intel has not shown a propensity to let competitors get away with much). Intel has many, many, many more resources (e.g. $) at its disposal than does AMD. AMD can't win a price war because Intel can last much longer than AMD can. The only way to compete effectively is to either find a niche that the bigger guy doesn't want to occupy (not the case here) or to use the competitors strengths against him (e.g. provide customized products when the competitor has built an infrastructure around mass-produced products). AMD was successful in going after the low-end initially, but Intel responded with the Celeron, and is continuing to reduce the price of the Celeron to push back AMD. Check AMD's profits for a scorecard of the results. Intel can keep it up a lot longer than AMD can. It is pure folly for AMD now to go after Intel's bread and butter market. Dave