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

To: heatsinker2 who wrote (53406)	8/31/2001 1:54:18 PM
From: wanna_bmw	Read Replies (1) \| Respond to of 275872

Heatsinker, Re: "a lot of IT managers will decide to purchase Ghz Celery boxes instead of P4 boxes." And why would they do that? wanna_bmw

To: heatsinker2 who wrote (53406)	8/31/2001 2:04:42 PM
From: Tony Viola	Respond to of 275872

Heatsinker, even AMD's "pocket analyst" Dan Scovel is saying good things about Intel. This is a first, to my knowledge: "Clearly, Intel is back in the catbird seat," Scovel said. Intel steps on the accelerator August 31, 2001 12:00 AM ET by Michelle Rushlo RELATED STORIES • Sun warns of revenue shortfall • Gateway to shut down some operations • More by Michelle Rushlo -------------------------------------------------------------------------------- Want to receive Big Caps Weekly every Friday in your email inbox? Subscribe to our free newsletter. Intel (INTC) hit the accelerator again this week, upping the ante in the never-ending battle to market a faster microprocessor. The company introduced its 2-gigahertz Pentium 4 processor, apparently giving itself a jump on competitor Advanced Micro Devices (AMD). "If you look back at Pentium 4, we've been really aggressive," said Intel spokesman Robert Manetta. "The numbers speak for themselves. We believe we have the fastest part out there." Who's faster? But AMD officials were quick to point to benchmark tests like those published by hardware analysis company AnandTech (founded by an AMD hobbyist). Those tests suggest that even though the clock speeds are faster, the 2-gigahertz chip is less efficient at some tasks than AMD's 1.4 gigahertz offering. The new Intel chip beat AMD in some video game and content creation tests, while AMD's chip did better on some business application and video compression tests. On a number of other tests, the chips performed similarly. "Megahertz is only one part of the equation. What's important is the overall performance of the chip," said AMD spokesman Ward Tinsdale. Analysts say Intel's advancement to the 2-gigahertz mark can't be that easily dismissed. Buyers are conditioned to compare clock speeds, and few have the expertise -- or enough interest -- to look at benchmark tests. Computer shoppers use processor clock speed as a comparison point, said Rob Enderle, an analyst at Giga Information Group. "It looks like Intel is faster," he said. "[The 2 gigahertz introduction] does potentially do a lot of damage to AMD." Bank of America Securities analyst Douglas Lee agrees. The initial introduction doesn't immediately change the marketplace, he said, but "there is a psychological statement it makes." Intel has broken a speed point that AMD is unlikely to reach until next year. Back in the lead Intel's new faster chips are particularly potent when combined with the aggressive price cutting that Intel has been doing on other fairly new chips in an effort to recapture share lost to AMD. Lee said Intel doesn't have to match AMD's prices dollar-for-dollar. Computer makers have an easier time selling Intel-based computers, so Intel simply needs to stay competitive on price to take share back from AMD. "If they keep up this trend, you'll get much better performance at this lower price point," he said. Dan Scovel, an analyst at Needham & Co., notes that Intel and AMD remain very competitive on low-end desktop and laptop chips but said Intel's new Pentium 4 introduction puts significant pressure on AMD's high-end. After clearly being beat by AMD to the 1-gigahertz mark early last year, Intel has recaptured the performance lead, he said. "Clearly, Intel is back in the catbird seat," Scovel said. OTHER BIG CAP NEWS THIS WEEK: European Commission eyes Microsoft The European Commission said Thursday it is investigating whether Microsoft (MSFT) is illegally tying its Media Player to its operating system and whether Windows 2000 is designed to work better with its own servers than those of rivals. The commission, however, said it would not expand its investigation to cover Windows XP at this point. A number of rivals have objected to Windows XP, saying it unfairly leverages the operating system to squeeze out competitors in other areas. More clouds for Sun Sun Microsystems (SUNW) warned investors Wednesday that it would probably report a loss during the current quarter. Company officials said lower than expected sales in Europe and Japan made it very unlikely it could hit the $3.7 billion revenue mark needed to break even. (See "Sun warns of revenue shortfall.") Gateway reins in business Gateway (GTW), the No. 4 computer maker in the United States, said Tuesday it will close operations in Malaysia, Singapore, Japan, Australia and New Zealand. The company might also dump its European operation. The reorganization could result in a quarter of the company's 19,000 employees losing their jobs. (See "Gateway to shut down some operations.") Michelle Rushlo is a reporter at UpsideToday covering big-cap hardware and software companies. If you would like to submit a letter to the editor regarding this story, email online@upside.com. upside.com