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

To: Tenchusatsu who wrote (260290)	5/16/2009 9:20:29 AM
From: TGPTNDR	Read Replies (1) \| Respond to of 275872

Tenchusatsu, Re: Here's a mental exercise to challenge that line of reasoning. What would have changed had Intel given the same rebate schedule to all OEMs, including the one who was offered one million free AMD CPUs? > Another might be is offering one million free AMD CPUs to one manufacturer smart and legal? -tgp

To: Tenchusatsu who wrote (260290)	5/18/2009 10:27:16 AM
From: JCB01	Read Replies (4) \| Respond to of 275872

Here's a mental exercise to challenge that line of reasoning. What would have changed had Intel given the same rebate schedule to all OEMs, including the one who was offered one million free AMD CPUs? Or no volume rebates at all? OK, I'll bite No volume rebates? I would have taken every single one offered. A standard, stepped discount schedule with no other rebate scheme, et al? Depends - I'd have to see the numbers. I would have at least taken the majority with the total amount depending on where I was at with my remaining needs with respect to the discount schedule. I might drop some to stay above a required volume for a price break. There are some other things that could throw a monkey wrench into my calculations - such as the market power of Centrino, which I think was relevant to the time period in question (could be off, but the point remains). If the CPU's were mobiles, I might have customers that specify Centrino instead of wireless networking. Otherwise, I would base my orders on minimizing my costs, because I would have considered AMD and Intel equivalent and I could sell that to my customers. What's more... I might even continue to do that in the current environment to some extent (where AMD is inferior across the board, but budgets are tight). For the vast majority of customers, benchmarking for the very best matters little. As long I can meet certain requirements - x amount of battery life, meets requirements for x software, x amount of RAM, 802.11whatever compliant, x size screen at x resolution, gigabit networking, etc., most customers won't care what processor is powering their computer. Price and meeting requirements drive their purchases. If my processor price drops, I can add in a bunch of other feature at a given price point. Do you think those answers are unreasonable? On a separate subject, I think Combjelly made the point that Intel was reacting out of desperation with their backs against the wall. I would have put it this way: If AMD gains the ability to supply a significant portion of the mainstream CPU market, that is desktops and laptops, with competitive chips, the dynamics of the market would change. Margins in the business would rapidly erode as the dreaded "C" word began to applied - Commodity. I believe there is tremendous incentive for Intel to keep AMD down below the ability to supply a small percentage of the market. I also think Intel is now more worried about the commodity threat from a different direction - ARM, netbooks, and nettops. ARMbooks and ARMtops are crappy now, but they are cheaper. Significantly. I think of them the same way that I do of the Pentium Pro and the server market - the nose of the camel under the tent... which is usually followed by the whole camel - for those not familiar with the saying.