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

To: Tenchusatsu who wrote (241951)	10/6/2007 12:07:35 AM
From: fastpathguru	Read Replies (2) \| Respond to of 275872

That "rebates are good" argument was a troll, not a strawman. ;-P Maybe you wouldn't be bumping up against the speed limit if you didn't troll so much. My original point was that AMD is making the wrong argument with that $14.89 "premium." You are arguing from the standpoint that Intel has unfair market power, and you come up with a very long-winded hypothetical situation, as if I'm too "thick-headed" (your words) to know what you are talking about. A) AMD is not "making the wrong argument with that $14.89 premium." They are making multiple, reinforcing arguments including that one. B) I have not come up with this situation, it is front & center in the AMD complaint against Intel. My "long winded" illustration of the concept is for those who have yet to understand what the issue being argued about is. That being, Intel is accused of tailoring their rebates such that AMD is excluded, even while Intel makes more money and the consumer pays more than they would with a simple volume-based rebate. I repeat: Moving volumes by offering volume discounts is a common practice in business. There is no "gun to the head" of the OEMs, as they can decide for themselves whether to tell Intel, "Screw your rebates, I'm going with AMD instead." The cost to make that transition wasn't prohibitive at all, as HP and Dell demonstrated. So much for that "smoking gun." Repeat: Intel is not accused of "offering volume discounts." They are accused of price discrimination and predatory pricing disguised as volume rebates. The difference between straight volume rebates and Intel's discriminatory/predatory pricing is that in the former case, the same discount schedule is offered to all OEMs and is based on volume efficiencies, while in the latter, the volume triggers are tailored to the customer and are designed to monopolize. You can repeat your "rebates are always good" line all you want... All you are doing is reinforcing your state of ignorance. Either way, the OEMs will do what's best for the OEMs, and that means buying parts at the lowest overall cost possible. Whether it's through volume rebates from Intel or through buying deeply discounted parts from AMD, the result is the same. Competition is lowering their costs. No, you still don't get it. Discriminatory rebates are raising their costs and excluding the lower-cost supplier, as I illustrated in near baby-talk just for you. The fact that you're still talking about volume discounts, that I agree are legal and ubiquitous, proves that you still have a fundamental misunderstanding of the rebate issue. Because Intel is not accused of abusing its market power with simple volume rebates, but rather, discriminatory and predatory share-based rebates. The question is not whether my illustration of the concept is correct or not; It is correct. (And that's not being egotistical, it's elementary-school level mathematics.) The question is whether Intel structured their rebate scheme this way (as they are accused of doing.) fpg

To: Tenchusatsu who wrote (241951)	10/6/2007 1:27:53 PM
From: kpf	Respond to of 275872

There is no "gun to the head" of the OEMs, as they can decide for themselves whether to tell Intel, Screw your rebates, I'm going with AMD instead." There is where the crux lies imo, i.e. why your opinion differs from others: It is the underlying paradigm everybody could freely decide to go with Intels scheme or not. While this might indeed appear so on first glance, when this comes down to a decision to stay in the business with Intels scheme or not with refusing it the literal "guacamole"-statement and the "gun at the head" comment are appropriately expressing what is behind it. I concede fpgs illustration of rebate-schemes in principle is not at all compelling evidence for the crucial point above - not only because it was not where he wanted to go with it, but for the reason it cannot be done with rebate-schemes or any other measure alone, but only in a context with other measures including MDFs (e.g. funding advertizing, flyers etc.), financing (e.g. terms of payment), rebate-schemes and many many more subtle instruments. What i am getting at is the impact of any measure remains opaque unless you get to a comprehensive understanding of what many measures do in concert. Getting through to this point cognitively is complex enough to make it an endeavour consuming thousands of man-years for discovering, preparing and condensing evidence to eventually provide at least a scribble of the picture that allows reasonable judgements on every particular claim AMD has made. Having said this, I don't expect a ruling - because transparency of its practices (considered legitimate or not by law) would harm Intel more than concessions in a settlement. So every personal verdict based on any arbitrary aspect of the case will not likely ever conflict with a jury's opinion. K.