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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Joe NYC who wrote (52288)	8/24/2001 5:57:42 AM
From: peter_luc	Respond to of 275872

Joe, a desperate but excellent idea! <eom>

To: Joe NYC who wrote (52288)	8/24/2001 7:38:47 AM
From: TechieGuy-alt	Read Replies (2) \| Respond to of 275872

How about this. AMD offers this deal to Tier 1s: Any company that will be the first fo ship 250,000 processors in commercial sector will have these CPUs for free. The runner-up will have 125,000 CPUs for free. This would be a desperate move, but these are desperate times, since it appears that there is exactly 0% chance of AMD landing a commercial win using "conventional" marketing methods. But you don't understand. This is how a typical conversation with AMD goes: AMD: "Hey look at our newes't chip. It really performs better than the equivalent brand I chip. Are you going to consider it?" Big OEM: (Excited) "This is great! Finally we have an alternative to brand I. Let's negotiate some prices. In the meanwhile why don't our engineers get started on the design." [curtain. Months go by with back and forth negotiations between AMD and BigOEM. AMD is refusing to budge on pricing too much as their chip is so much better (or infrastructure is lower cost or what ever)]. BigOEM: (taking out the Brand I stick). "Look, it's crunch time. Time to decide. We've talked to brand I and they are ready to supply us chips for half what you are asking for. If you don't come in at least 10% better than that, we don't have a project". AMD: "Ok, just this once (to get the long awaited business line design win)." [Everyone's happy. Lots of dancing and merry making on the stage. Jerry even alludes that there will be a "big" commercial design win in the next Q for sure]. [Curtain. About 4-5 months pass while, the AMD commercial design is being completed and tested and made ready to go into prodution.] [1-2 week(s) from announcement] Brand I (to BigOEM): "Look guys, enough playing around. The bottom line is that we cannot let AMD have even a single "BigOEM" commercial win. How about this deal: A little birdie told me that your are having a difficult time meeting your Q group goals. How about we give you $xxx for "engineering assistance" to switch this AMD design to our design. This way you can make your Q and everyone's happy. [Scene cut's to BigOEM's internal meeting] BigOEM: Executive1: "You know, we can always give AMD another chance. We really need this "engineering assistance" $$'s. My quarter bonus [or job] depends on my group turning a profit. I've got kids to feed." BigOEM: Executive2: "You'r right, but how do we get a board done in a week and ship it. We have to announce a product in a couple of weeks at the latest." BigOEM: Executive1: "What's about Don's group? They have a design done. They were never brave enough to go to AMD in the first place. We can change to chassis, the graphic card options and the price and bingo! we have a solution". Everyone: "Ok, so it is decided. We think that brand I solution was better in the first place. I think AMD fudged their benchmarks". BigOEM (to AMD): "Sorry AMD, maybe next time. There are "internal" issues that you don't understand. We have to have a brand I offering this Q. We will give you another chance. Promise." [Scene cuts to Jerry in a mad rage throwing things at chief of brand I's potrait in his office]. ...and the saga continues over and over again..... TG

To: Joe NYC who wrote (52288)	8/24/2001 3:32:03 PM
From: TimF	Read Replies (2) \| Respond to of 275872

Jozef, not a bad idea but very expensive. Assumeing no Durons in the business line lets say the average chip would have had an ASP of $100. That would mean a loss of $37,500,000. Even if you are just talking about the costs that would be what $25 each (?) or an actual loss (not a loss of possible income) of over $9mil not includeing overhead. Maybe something similar but with slightly lower numbers. Like 200,000 free chips for the winner if they sell 250,000 or maybe 300,000+ and 50,000 for the runner up? Also how do you think Intel would respond? Tim