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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Steve Porter who wrote (77741)	10/29/1999 12:19:00 PM
From: Tony Viola	Read Replies (3) \| Respond to of 1572107

Steve, . I think Intel would be quite happy to sell one high-end unit per household and leave the 'desktop' and 'appliance' chip market to others.. thoughts and comments? Never happen. IMO. Corollary might be will Toyota ever give up "entry level" cars, even with Camry, 4runner, etc. selling extremely well? I don't think Toyota, or Intel will give up the low end, as long as their markets stay anything like today. 25 years from now, who knows? Tony

To: Steve Porter who wrote (77741)	10/29/1999 1:49:00 PM
From: Paul Engel	Read Replies (1) \| Respond to of 1572107

Steve - Re: "After reading through the Intel slides, does it seem to you like Intel would be quite happy to walk away from the desktop CPU market (over a period of years of course) and focus on very high-end workstations/servers." Absolutely not. Intel wants to be the all-around-provider for e-commerce/internet infrastructure. And Intel has learned a valuable lesson - if you give up the low end, the low-end winners start to nibble at the high end. AMD made in-roads on the low-end - temporarily as it turns out - and that allowed them to hang around long enough to get the Athlon chip out. Intel will now have to protect that high end with a full court press - which they appear to be doing with high end Cascades chips coming - 2 Meg of L2 cache on-chip. Intel will probably own 90% of the low end by this time next year. Celeron costs are coming down - as the die size will go from ~154 sq. mm to ~ 90 sq. mm. - and performance will JUMP. As Timna gets worked into the PC market, I can see it usurping the Lion's share of the low end by H2/2001. Intel will protect its low end at all costs - simply to prevent any repeat of the AMD encroachment seen in 1997/1998. Microsoft referred to this as "cutting off the oxygen supply" of competitors. Paul

To: Steve Porter who wrote (77741)	10/29/1999 2:04:00 PM
From: Paul Engel	Read Replies (4) \| Respond to of 1572107

Steve - Re: "I think Intel would be quite happy to sell one high-end unit per household and leave the 'desktop' and 'appliance' chip market to others.. thoughts and comments?" Intel views - and properly so - the CPU business as an athletic contest - there is one and only one winner. Intel wants to be that winner. Near Total Dominance in the past has helped Intel invest in state-of-the-art manufacturing fabs - and they see their future ability to do the same tied to maintaining that dominance. A market fragmented by 2 or more suppliers, each holding a small fraction of the overall market, results in stagnation - due to lack of real profits for future investments. Intel learned that lesson in DRAMs and SRAMs, both of which they essentially invented in the late 60's and early 70's. As more competitors came in, Intel's profits didn't allow them to make huge investments (Intel at that time was much, much smaller than it is today) to protect those markets - and they eventually lost their competitive position - along with profits - and had to withdraw from those markets. And even the survivors of those markets (SRAM/DRAM) have divided up the market so that essentially none of them can make a profit over a sustained period of time. With that experience behind them - but still "fresh" in their "memory" - Intel will protect its market share in every segment of the CPU market. Paul