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

To: Process Boy who wrote (98068)	3/11/2000 7:55:00 PM
From: Scumbria	Read Replies (1) \| Respond to of 1570724

PB, What is the Spitfire core for, if not to compete for just the kind of lower end business that the X-box would be? AMD had a wonderful experience competing against Intel at the low end with K6. I can see why they might have wanted to repeat that experience with x-box. Intel has the cash on hand to undercut any AMD sale at the low end. They could pay Microsoft to use their CPUs. The only way that AMD can compete is to have a faster processor than Intel, which for the time being they do. Scumbria

To: Process Boy who wrote (98068)	3/11/2000 8:12:00 PM
From: eplace	Read Replies (2) \| Respond to of 1570724

PB: re:I still have a question, with all due respect: What is the Spitfire core for, if not to compete for just the kind of lower end business that the X-box would be? Does the X-box competition just witnessed a portent of what AMD faces as it attempts to compete across the various segments, as AMD says it intends to do? Honestly wondering. PB The Spitfire is just for that lower end you are talking about. You know as well as I that Intel is big time big business. AMD is lucky to have made the inroads they have. They are not going to ever dominate (at least not in the near future) the market like Intel has. I think they will compete well on the lower end, just not have a presence in the Xbox. Thats it. Ed P.

To: Process Boy who wrote (98068)	3/11/2000 9:02:00 PM
From: Dan3	Respond to of 1570724

Re: What is the Spitfire core for, if not to compete for just the kind of lower end business that the X-box would be? Spitfire is for entry/mid level and SOHO/home systems ($600 to $1000). The X-Box segment of the business is the non-profit CPU sales business: a segment AMD dominated for several years but which has recently been snatched away from them and has become a core Intel business. Alas, poor AMD has been relegated to the mid and high end ranges where it is forced to make large amounts of money. :-) Dan

To: Process Boy who wrote (98068)	3/11/2000 9:46:00 PM
From: steve harris	Respond to of 1570724

www1.amd.com Question: What are AMD's plans for the AMD Athlon processor in 2000? Answer: In 2000, AMD plans to introduce differentiated versions of the AMD Athlon processor based on three new processor cores. These three new cores are codenamed Thunderbird, Spitfire and Mustang. Thunderbird is planned to be a high-performance version of the AMD Athlon processor with integrated, full-speed L2 cache. Both Slot and Socket A implementations are expected to be possible. Thunderbird will be targeted at the performance workstation and desktop markets. Spitfire is planned to be a value version of the AMD Athlon processor with integrated, full-speed L2 cache. Spitfire is planned for Socket A implementation only. Spitfire will be targeted at the value desktop market. Mustang is planned to be an enhanced version of Thunderbird, featuring a reduced core size, lower power requirements and large, full-speed, on-die L2 cache. Multiple versions of the Mustang core are planned to be targeted at the high-performance server/workstation, value and high-performance desktop, and mobile markets.

To: Process Boy who wrote (98068)	3/12/2000 2:52:00 PM
From: Charles R	Respond to of 1570724

PB, <I still have a question, with all due respect: What is the Spitfire core for, if not to compete for just the kind of lower end business that the X-box would be? Does the X-box competition just witnessed a portent of what AMD faces as it attempts to compete across the various segments, as AMD says it intends to do? Honestly wondering.> As a first order approximation, it will cost AMD about $1.2B in fixed costs to maintain the microprocessor business in 2000. This needs to be allocated over approx 30Mu (Athlon+K6s). So, we are talking about $40 per chip on average. For Intel the comparable numbers are about $5B over 120Mu. Again, roughly $40 per chip. This does not mean that each unit needs to produce $40 over variable costs (let's say Intel has $5 cost advantage and assume $25 for PIII and $30 for Spitfire in H2 00). But this means that on an average both companies need to get $70-$75 per unit to make money - a number that Intel has comfortably achieved over time and a number that AMD has sporadically attained before Athlon. The only high volume business in which above $70 ASPs can be obtained for CPUs is the PC business. Real-money for both Intel and AMD will continue to be in the mainstream PC place for a long time to come. Clearly, X-box business will clearly not fit this model except as an incremental revenue generator once the main stream business is serviced. So, the right way to look at this is to separate the X-box business from the mainstream PC business. Then the question to ask is "how will AMD (or Intel) compete in the low-end PC business" - and the answer is "by trying to make as much money as possible at the high-end and taking opportunistic low margin business as it makes sense". I am simplifying things here but hope I have got the main point across - competing for X-box business in the near term is entirely different from competing for mainstream PC business. Chuck