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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: William F. Wager, Jr. who wrote (174530)	2/27/2005 10:59:12 PM
From: Meathead	Read Replies (1) \| Respond to of 176388

Re: AMD is simply incapable of supplying the kinds of volumes Dell bases it's business model on, IMO. It really goes much deeper than that and the reasons have as much a political component as anything. If Dell were to begin using AMD processors, most likely it would initially be targeted at a niche market/product where they surely could handle the volumes. The real reason behind the reluctance on Dell's part to embrace AMD is that it would cost Dell money to do so. And the money they would have to spend still does not justify the return based on customer demand. Sure AMD's Opteron processors have a dual core performance advantage at the moment, but for every advantage AMD gains, it assuredly becomes short lived as Intel catches up lickity split... usually less than a full product cycle. One of the things that would cost more money is the addition to, and sequestering of, engineering resources, facilities, equipment, etc., etc. Dell can not allow cross-pollenation between Intel and AMD design teams so they would have to duplicate resources... something they are loathe to do. And since AMD does not design supporting chipsets like Intel, even more resources would be required for platform development efforts. And as everyone knows, being faithful to Intel and being the leading volume supplier of their processors and chipsets has it's advantages when it comes to the deals they can negotiate. In addition, constantly evaluating AMD products with the potential threat of acceptance always looming overhead is one of the levers Dell can pull to turn up the heat on Intel. I too really thought Dell was about to welcome AMD onto the product roadmap this time however. Intel has made many missteps, suffered product delays, and the Mort thing seemed like the final harbinger of things to come.. wink wink, nod nod. Like one journalist so eloquently put it... Dell to AMD is like Lucy holding the football for Charlie Brown. MEATHEAD