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

To: kash johal who wrote (109525)	5/5/2000 10:46:00 PM
From: TimF	Read Replies (1) \| Respond to of 1577891

Intel decides to sell a MB/CPU for say $80.00 ( timna cost of say $25 plus $20 fro board and misc components). This would still be a pretty good margin of 40-45%. AMD will have to sell Durons for $XXX + MB say for <<$80 to be competitive. Why does a Duron + MB have to cost as little as a Timna+MB? I think Duron will perform better then a Timna. If you are just going to compare costs then maybe you should compare Duron + MB + cheap video card to Timna + MB, because the Timna's integrated video, but I think it likely that many cheap video cards will perform better then Timna's video (and be easier to upgrade later). Tim

To: kash johal who wrote (109525)	5/5/2000 10:46:00 PM
From: Joe NYC	Read Replies (2) \| Respond to of 1577891

Kash, Intel decides to sell a MB/CPU for say $80.00 ( timna cost of say $25 plus $20 fro board and misc components). This would still be a pretty good margin of 40-45%. AMD will have to sell Durons for $XXX + MB say for <<$80 to be competitive. Voila.......Houston we have a problem. If $XXX is sub $30 each duron will have some of mine and your dollars attached to it. It is possible, but I don't think it's in Intel's interest to do something like that. Intel has 80%+ of the market, and there is a lot more for Intel to lose than for AMD. AMD is gradually departing the lowest end segment. I don't know how this will play out, but I think Timna is more of a thread to Via if they ever really get into x86 microprocessor market. AMD can just increase the clock speed of Duron to 650 - 800 MHz range, and will be well above Timna in MHz. Once we get to the Mustang core, I think Duron will be in 800 to 1 GHz range, and Athlon > 1 GHz. Joe

To: kash johal who wrote (109525)	5/6/2000 1:40:00 AM
From: Dan3	Respond to of 1577891

Re: Intel decides to sell a MB/CPU for say $80.00 ( timna cost of say $25 plus $20 fro board and misc components)... Are you assuming a sealed box, no expansion slots? (otherwise the board size and connector costs will add $10 to $20 to your estimate) Video, sound, integrated? You still need a disk controller, power regulation, video ramdac (I think), clock, EPROM for bios, SDRAM translator chip, DRAM slots, etc. Cost of such a system might come in at your $50 price point but it would be a badly crippled machine, and to keep it cheap it would have to be a small board. Power regulation and heat dissipation would possibly limit the speed of processor that it could handle. Intel had expenses of a little more than $6 Billion dollars last quarter, if they sold very many of the bundles you are describing for less than $200, they could easily start losing money. Duron will be over 700MHZ in the time frame we are discussing, the SiS motherboard with integrated graphics controller will be available (and probably others as well), and the Duron system will be a full fledged, expandable, upgradeable computer. Such a system would substantially outperform the closed box timna system, and raw costs would be in the range of $80 ($30 chip, $50 board). AMD, SiS, Via, etc. have overhead much lower than Intel's, and don't need gross margins nearly as high in order to make money. AMD has shown that it can do very well with low end chips selling for less than $50 - and in the coming quarters it will have profits from high end chips making those low end profits even less important. At least that's what it looks like right now. Intel sold about 30 million processors last quarter at an ASP supposedly (it's a big secret) around $200. That's $6 Billion in total revenue if true. Sine $.5 Billion of that was from capital gains, and they must be getting something from networking and chipsets and motherboards, etc., I would guess that their actual ASP was closer to $150 than the $200+ number everyone keeps bandying about. (which would yield $4.5 Billion of their $8 Billion total revenue) But if they start selling millions of motherboard/CPU bundles with a gross profit of $30 (instead of $100+), they will start to feel some pain - and I don't think it would do much harm to the sales of full fledged computers with >700MHZ Athlon core processors in them, anyway. The only real threats I see are AMD production disasters or Willamette being a home run and ramping much, much, faster than expected - and right now neither looks very likely. If Intel really pumps out volume timnas and gives them away, it would hurt Intel more than AMD (IMHO) Just one opinion. Regards, Dan

To: kash johal who wrote (109525)	5/6/2000 2:00:00 AM
From: Charles R	Respond to of 1577891

Kash, <AMD will have to sell Durons for $XXX + MB say for <<$80 to be competitive.> I really doubt if AMD will put Spitfire in this market this year. It is likely to have at least 100MHz advantage over Timna for this year (AMD has the option to pull seriously ahead in MHz if Intel chooses to get too aggressive on pricing.) I have a hard time seeing Spitfire ASPs getting under $50 even with super aggressive attack from Timna. Just my 0.02 cents. Chuck