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

To: jay101 who wrote (247644)	2/12/2008 3:19:45 PM
From: pgerassi	Read Replies (1) \| Respond to of 275872

Jay101: Playing dumb and dumber. Intel is accused of anticompetitive acts. Some might help consumers now, but hurts them much more later. Others hurt them always. One of them is like you buy exclusively my CPUs and I'll give you a $10 break on the prices and a matching amount for any advertising of them with my name prominently displayed (I must approve each ad) not to exceed $10 for each CPU you buy. I will charge $20 more to everyone for my CPUs, so matter what, I will make out on the deal. To get the max, the OEM would have to spend $20 per CPU advertising their computers (and my CPU) with me putting in $10 per CPU. I'm ahead with 10-20% additional computers where the marginal profits are 80-90% and gets $2 of advertising for every $1 I spend. The OEM gets little but an assured CPU supply, small profit based on a percentage of the total cost and a price break against any competitor not toeing the line. The consumer gets the shaft having to pay $130 plus the OEM's additional profit per CPU. Especially if the consumer wants the other guy's better, cheaper, faster CPU. I also get two more controls on the OEMs, one I can hold back payment for any reason to punish them and second, I can threaten to not supply them with the highest in demand CPUs by going on "allocation". So the consumer has to pay even more and gets less than he wanted. So all of Intel's acts put together makes the consumer pay more for less. If AMD would get out of the CPU business, don't you think Intel would immediately raise prices to get back to the high gross margins they enjoyed (70-80%)? If you don't, you living in "La-la Land". Pete