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To: muzosi who wrote (247748)	2/13/2008 5:17:44 PM
From: chipguy	Read Replies (1) \| Respond to of 275872

if amd stops competing for any reason intel's asps will go much higher overall. claiming that this won't happen is not intellectually honest. The opposite of "Intel's ASPs will go much higher" IS NOT "Intel's ASPs will stay the same". It is a pity that some folks have such limited capacity for clear logical reasoning.

To: muzosi who wrote (247748)	2/13/2008 5:52:09 PM
From: wbmw	Read Replies (1) \| Respond to of 275872

Re: one indication is that it doesn't is the asp difference between desktop/server parts and notebook parts. intel's notebook asp has always been higher and even when amd introduced competitive parts for desktop/server that didn't change. Did it ever occur to you that the reason ASPs were higher in mobile and server was because the consumers of those markets are willing to spend more for them?? In mobile, people demand power efficiency and small form factors. They have a choice of spending more for a laptop, or spending less for a desktop, and they will spend more for a laptop, even though the performance is less. That has to do with the mobility of a laptop PC, which allows for other usage models that are in higher demand than desktop computers. And that premium will exist for as long as consumers demand it. Laptop chips didn't always carry a large premium over desktop chips. Intel introduced their first mobile chip with the Mobile Pentium II, and the price delta there was fairly small. But when Intel introduced Centrino, the idea of wireless computing appealed so much to consumers that Intel was able to charge a lot of money for chips that had lower performance than the desktop equivalent. It was INNOVATION that set the price premium, not lack of competition. As for servers, the issue is Total Cost of Ownership. TCO is so burdened by software and services costs that hardware is trivial, and the processor is a very small percentage of the overall system and enabling costs. Due to this, server consumers are willing to spend more for the processor. It's hardly a profound economic discovery, but Intel takes advantage of it nevertheless - and so does AMD! Re: i think it's clear that when amd doesn't have competitive parts intel can command a higher price regardless of price elasticity or business cycle or any other reason than if amd competed. Well, based on your complete lack of understanding of price elasticity or the factors driving the market economics, I'll just have to take your claim with a grain of salt. In my view, the opposite is clear, and that's precisely why Intel hasn't raised prices in response to their vastly more competitive current product line. And I'm pretty sure the MBA and economic doctorates at Intel with dozens of years experience know a few things about pricing strategy more than a few anonymous forum posters who assert their claims with nothing to back themselves up. Re: if amd stops competing for any reason intel's asps will go much higher overall. claiming that this won't happen is not intellectually honest. Are you seriously trying to lecture in intellectual dishonesty? LOL, you're just confusing it with lack of insight on your part. I don't claim that Intel wouldn't WANT to increase pricing. In fact, I truly believe they would. But doing so won't keep the market demand at current levels. And why not? BECAUSE THE VAST MAJORITY OF PC CONSUMERS ALREADY OWN 1 OR MORE PCs! I'll wait a few seconds for that to sink in................................................................................................. What this means is that people who are buying a new PC in mature markets are looking for something BETTER than what they currently have. Intel can't just raise prices on existing products. I have a PC purchased in 2006 with a Conroe E6600. I bought the processor for something like $260, and today I can get an Q6600 for the same price. Not too bad, but I probably wouldn't spend $380 for that processor if Intel raised prices. Nor would I spend the same amount for an E4600 that performs less than what I currently have. E4600 is a steal at $133, but Intel couldn't raise prices too high on this part without seriously impacting demand. The word for this is called PRICE ELASTICITY. On the other hand, if I waited until next year, and Intel introduced a brand new quad core Nehalem with 2x the cores and 3x the performance of my E6600, I probably would spend $380 for it, or even $550. Why? Because it's substantially better than what I have today. So Intel can raise prices, but it takes time, and it takes better products. It also takes a competitor who is standing still, because if AMD were to offer a product that had 2x the performance of my current system at the same time Nehalem had 3x as much performance, and AMD only charged $200, then I might be swayed to explore the competition, rather than spend $550 for something 3x better.