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Technology Stocks : AMD:News, Press Releases and Information Only! -- Ignore unavailable to you. Want to Upgrade?

To: Brian Hutcheson who wrote (3166)	12/25/1997 2:28:00 PM
From: greg nus	Read Replies (1) \| Respond to of 6843

Brian, Grove has stated that the Internet Paragem is the "Killer Aplication" for the PC. beginning in just a few days all phone bill in the US will have a $4.00 per month surcharge on the bill thanks to VP Gore and the Clinton Administration. The charge will be spent to wire every US school and library to the Internet on the infromation highway. This and the rapid drop in fully functional PC with the exploding growth in the sub $1000.00 will be the driving forces to get the other 60% of unwired American household wired. Every parent will spend the money for a PC to further the kids education. School homepages will keep parents informed of kids school progress and to stay informed about school issues. The library homepage will do the same in handeling community issues. The concept of the village within the city will unite the citizenry to addressing a miriad of day to daylliving issues. This will keep the CPU and computer boxmakers plenty busy in 98 even without Asian orders. So far Intel seems to allocate a higher priority to the high end of this pheonominum. The server market ect. They also are going after the TV PC convergence with new design for settop and hardwired digital tv with internet capability. That replacement market alone for new TV is over 100 million anuallly. 1998 may be the first year that more pc's are sold then TV's assuming this already did'nt happen in 97. Intels new box top units and hard wired chipsets are going to be cheap $100 to $200. initialy and falling to $50.00 by year end. These will give Intel volume sales in a new "Eye Ball" market segment but not at the same margings intel is accustom to with CPU. What is clearly absent in Intels stratgdy is..What to do about the sub $1,000.00 PC market. There is no Intel front line product strong enought to dominate the sub $1,000.00 market segment. Nor can Intel afford to sacrifice margins by cutting prices far enough to appease boxmakers without impacting earings which are already affected by a 47% expsoure to the Asian growth markets (including). AMD is much better positioned to dominate the sub $1,000.00 for two reasons. The K-6 (cheap) socket 7 (cheap) product line is now the best fully functional CPU chip of choice for the money. The selection of K-6 technology by Compaq now puts to rest any doubts about that. Buy the way Dell will be forced to follow compaq's move. Secondly and more importantly given AMD financial position(relativly strong stronger than NSM), given AMD stock has already calapsed, AMD has demonstrated (reluctantly as to financil consequences) it's willingness to be the defacto low cost producer even if it means it has to do so at a temporary loss or breakeven. Some one recently mentioned a quote from the ART of WAR about placing yoursef in the shoes of your enemy. Imagine just for a moment Intel's willingness to do what AMD has reluctantly done. The financial consequences would be herendos. Therein lyes AMD strenght and why it will survive. Right now AMD has nothing more to loose. If it elects to voluntarly enter into a bankrupcy for reorganization. It could file for a complete refund of all income taxes paid for the last five years about $1.7 billion if it had to. Enough capital to recapitalize, to reafirm what ever debt was critical to going forward and emerge as a leaner meaner low cost producer going forward. Intel would not be wise to press AMD further cause Intel would be a much bigger looser if they did.

To: Brian Hutcheson who wrote (3166)	12/29/1997 2:51:00 PM
From: David B.	Read Replies (3) \| Respond to of 6843

<<"U.S. households to buy PCs over next few months compared to last year, "the driving force is the low end" , high end products are not doing so well, to quote " the pricing umbrella at the high end has collapsed".>> Brian - When Intel has to start competing on price, then we'll see them start to sweat. Intel's business model seems to be based on a product roadmap that has a supercomputer on everybody's desk, in every home. Ever faster microprocessors...Moore's law and premium pricing... Great in theory. Intel has done an incredible branding job too. But the analysts and pundits have given very high marks to the K6, and the general public is starting to realize the value of choosing Intel alternatives. For the last few years it's been a speed war. Soon I think it will be a price war that neither team will really "win." (Note: Assuming AMD can produce sufficient quantity to get on the battlefield in the first place.)