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To: Elmer who wrote (66403)	12/27/2001 5:22:39 PM
From: Joe NYC	Read Replies (1) \| Respond to of 275872

Elmer, I have seen how many they get from a 12" wafer and it would make your jaw drop. When that is released for production Intel can sell those for a song and still make an excellent margin. I don't think this would work. There is a market for some 150 million chips per year. Suppose Intel can make these for $1 and sell them for $5. That's excellent margin, but that would also mean that INTC and AMD would become penny stocks. Intel has to sell these at ASPs of $150, and whether they cost $25, $10 ot $1 to make is not that relevant. Also, what is not very relevant is whether Intel can make their 80% of the 150 million, 100% or 500% of 150 million (= 750 million CPUs) Joe PS: Good FUD though

To: Elmer who wrote (66403)	12/27/2001 6:56:38 PM
From: fyodor_	Read Replies (1) \| Respond to of 275872

Elmer: You're entitled to your opinion, I don't share it Without devulging any inside knowledge on the subject you may be privvy to, what do you believe the difference in yield between AMD and Intel is? (ratio or in terms of percentage points) I'm really quite curious ;-) I believe CuMine is no longer a high runner at Intel but with XBox that may change Yes, clearly Coppermine is an "old" chip, but the same is the case with Tbird (my AMD example). That was pretty much the point, taking established, mature cores, instead of bringing something like the P4 into the picture. Tualatin now as P3 instead. I have seen how many they get from a 12" wafer and it would make your jaw drop. When that is released for production Intel can sell those for a song and still make an excellent margin. Intel will own the lowend as well as the highend. IMHO. Tualatin is clearly an awesome low-end chip - especially if Intel can ramp it in frequency (and initial indications would seem to support this). The main barrier atm would appear to be the performance of the P4! If Intel drove Tualatin hard and coupled it with a higher FSB, P4 would be a deep trouble in terms of performance ;-). As it is, I believe Intel will keep Tualatin on a significantly slower bus than P4 and limit the ramp in frequency (e.g. by optimizing for high yield and low die-size instead), at least until P4 is well on its way on .13µm. -fyo

To: Elmer who wrote (66403)	12/27/2001 10:15:46 PM
From: Dan3	Respond to of 275872

Re: They are selling Tualatin now as P3 instead. I have seen how many they get from a 12" wafer and it would make your jaw drop. When that is released for production Intel can sell those for a song and still make an excellent margin. Fixed costs are about 5 times variable costs in the CPU business - at least, that's a reasonable estimate from what can be discerned from public statements and SEC filings. Cutting the manufacturing cost of the CPU in half would cut Intel CPU costs by about 10%. How much of the cost of the CPU is fabbing the silicon, and how much packaging and testing? Intel's breakeven revenue requirement per CPU, after allocating Capex and Administrative, is about $120 to $150. The silicon on PIII accounts for what, about $15 of that? Cutting that down to $5 will barely be noticeable when total revenue required per CPU is $120 to $150.