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To: Dave who wrote (134340)	5/7/2001 1:23:09 PM
From: dale_laroy	Read Replies (2) \| Respond to of 186894

"Now, if history repeats, and AMD signs a similiar agreement with IBM, how does that help AMD?" AMD already entered into a similar agreement with IBM. AMD entered into a foundry agreement for the Littlefoot K6. AMD then moved quickly on to the K6-2. I don't recall AMD getting burned by this agreement. Indeed, the transition happened so fast that it took IBM months to unload the IBM branded K6 processors they produced during the short life span of Littlefoot K6. Cyrix made two mistakes. First, they granted IBM a license to produce their flagship processor. Second, apparently they left it up to IBM to determine what volume of 6x86 processors to produce, not market conditions. IBM flooded the market with 6x86 processors, resulting in the price collapsing. The outlined deal with IBM would differ in two key aspects. First, IBM would not gain a license to produce AMD's flagship Hammer until AMD launches K9. Second, IBM's Athlon/Duron production would be limited by the number of Hammer processors sold by AMD. The benefits would be that AMD could move quickly to close to 100% Hammer production without abandoning the Socket-A market, which would be taken over by IBM. Corporate buyers are concerned with platform stability, including knowing that they will not have to change to a new platform within the next 3-4 years. With AMD's commitment to Hammer, they do not see a commitment to Socket-A offering the needed criterion of long term availability. With IBM scheduled to take over the Socket-A market as AMD exits from it, corporate America could gain the confidence in long term availability needed to commit to Socket-A this year.