Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: GVTucker who wrote (182868)	12/9/2005 12:22:19 PM
From: etchmeister	Read Replies (1) \| Respond to of 186894

What about the Intel/Micron JV; don't you think it could eventually impact Intel's capex for NOR flash? IOW some $$$ got shuffled over.? And isn't Intel rushing a 300mm fab for chip sets

To: GVTucker who wrote (182868)	12/13/2005 3:43:14 AM
From: Amy J	Read Replies (1) \| Respond to of 186894

I also noticed Intel was reducing capex from earlier guidance. And I wondered why. Normally, I would think it's a good thing to avoid over-capacity, because empty fabs can be an absolute nightmare. However, doesn't the Samsung-thing completely change the rules for the industry (I'm seriously asking, I have no clue). I believe Intel's platform strategy introduces a higher level of risk that Intel didn't have before. When competing against AMD, Intel had the "luxury" to afford a neck-to-neck horse race. But with Samsung, one little stumble by Intel and Intel could very well strike out permanently in a subsector, if Samsung continues to aggressively grow its fabs, which it will (if the $33B is for fabs?). I think this means Intel may need to increase their backup plans - in both chip engineering (maybe duplicating projects within Intel and outside) as well as increasing their number of fabs. I think Intel needs to absolutely maintain a healthy amount of capacity at any given time (even during the downturns), or seriously risk permanetly losing market share to a powerhouse. This is because, with the platform strategy it may only take one shortage on one component (or one chipset) to knock out an entire platform line. The platform strategy does have its increased risks (and potential increased rewards too.) I don't think this is a huge risk for Intel today, but believe it is an enormous risk for Intel in about three to five years when Samsung completes its aggressive ramp-up. So I think the rules are different when competing with a marketplace manipulator that will use high volume in ways unimaginable - dumping, fixing, allocation freezes, etc., but am concerned Intel is still playing by the old rules - being careful not to build too many fabs. I think the only honest way for Intel to compete against a large market manipulator is to have a lot of fab capacity at any given time, so that the market manipulator can't knock Intel out during a shortage run. But I really don't know how Samsung and Intel stack up with their projected fab growth - so maybe I'm concerned about nothing. Some research firm should issue a report on this. Btw, on a different but related note, one of Intel's chip competitors (not AMD) is reliably rumored to be trying to cozy-up to memory firms -- here's what I think will happen: they will cut a packaging deal with maybe the likes of Samsung which will be great for Intel's competitor in the ST, until eventually their chips (I would suspect) will be copied by the memory company, then their package could be dumped and replaced with the memory company's "own" platform that competes with Intel's platform. I don't know if the later is true, but am certain about the reliability of the first part - that the industry is definitely responding to Intel's platform strategy by attempting to create package deals that simulate a competing platform. But I suspect they will eventually get it on the chin over the LT (not by Intel, but by their most-adventurous memory potential partner/s) after they get used by them, maybe copied & dumped so the memory company can come out with their "own" platform strategy. Of course, this is an American s/c company displaying unfortunately typical ST thinking - they are trying to go for short gains, and ignoring the LT risks. But what comes around, goes around, would be the most apt way to describe them. Regards, Amy J