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To: Steve Porter who wrote (59750)	7/11/1998 8:17:00 PM
From: Dale J.	Read Replies (1) \| Respond to of 186894

Steve, It has everything to do with the way Intel has chosen to respond. Intel was damned if they did, damned if they didn't. Only damned if they didn't. Intel only has allegiance to long-term investors. MSFT routinely talks down their stock, when investors complain, MSFT responds these sporadic run-ups are not good for the long-term investor. Well INTC is the same way, and the long-term view dictated INTC had to respond vigorously. AMD was talking about selling 20 million x86 chips and how INTC would be paralyzed with their high margins. Wrong. My guess is INTC will continue to respond using the law of proportionality. The more chips AMD produces the deeper INTC will cut prices. I fully agree you though, and I understand what you are saying about Jerry & company. He used the Netscape approach "we will kill windows". Well we know what happened. As it is AMD is severly hemoraging (I know it's not spelled correctly). NSM is so confused they don't know which end is up, despite the clearly marked box. IDTI is a little fly buzzing around.. it's hasn't done anything yet, but who knows what kind of disease it is carrying.. all it takes is 1 bite you know. <VBG> Nice analogy, but INTC has now been inoculated. Investors have accepted lower margins. As stockman would say "party's over dudes" for AMD. And as for Rise, IDT etc.. No way the party will never even begin for those guys. Dale

To: Steve Porter who wrote (59750)	7/12/1998 1:24:00 AM
From: Barry Grossman	Respond to of 186894

Steve, The 80th Anniversary issue of Forbes last July 7 had this article. Many here have seen this article and the accompanying chart but it's worth bring up again. The chart in the article ,which can be found by doing a search on the Forbes site, forbes.com, for "The silent boom", will show you a most revealing chart. This chart shows the PC's growth in terms of percentage used by the population year by year from the year of invention to the present and it compares the pc's rate of usage to other devices such as the telephone, radio, television, automobile, airplane, VCR and microwave oven. Most revealing chart. The point is that the lower prices of pc's have hastened the day when they are absolutely ubiquitous. More ubiquitous pc's mean more microprocessors sold by Intel. Some short term loss of profit will mean greater profits will accrue sooner than would have had not the pc become as ubiquitous as it will with lower prices and greater affordability. So it's not all bad. ------------------------------- The silent boom By Peter Brimelow A FUNNY thing has happened to the human race in the last hundred years or so. Ways of living and working that had not changed for millennia have altered abruptly. Reason: We caught a wave of new technology. The momentum is not going to slow. Judging from calculations by Dallas Federal Reserve Bank economist W. Michael Cox, displayed in the chart, technology seems likely to continue altering our lives ever more abruptly. It took more than a century for the telephone to reach its present 94% household penetration. (Note the Depression-era stall.) By contrast, more recent inventions, like television and radio, reached similar penetration levels in only three or four decades. And the most recent inventions of all-cell phones, personal computers, the Internet-are moving even faster. Not all technologies are equal. Some, like electricity, have pervasive consequences by virtue of making so many other inventions practical. The modern equivalent of electricity, says Cox: the microprocessor, invented in 1971. This made possible not only the recent explosive takeoff of cell phones and personal computers but also the sudden sharp increases in penetration visible (see chart) for older inventions like microwave ovens and VCRs. Another factor in some sudden increases in penetration: what Cox calls "network externalities." Until the number of people using a new technology reaches a critical mass, there are few real advantages to users. Your telephone would be useless if you were the only person who owned one. The Internet, television and radio would be useless without content, automobiles close to useless without paved roads and a network of gasoline stations. But good content and highways don't occur until a lot of customers are ready to use them. By contrast, some inventions, like microwave ovens, benefit the individuals using them more or less independently of anyone else. Technologies can be complementary rather than competitive. Radio was rapidly overhauled by television, but it has continued to grow and its penetration is now equal to that of television. Similarly, Cox speculates that tree-based print journalism will complement Internet electronic publishing. Whoopee! Ultimate message of the chart: The modern economy is changing in profound ways that cannot be picked up in GDP numbers. The pocket calculator, more powerful than a $750,000 room-size mainframe computer of the 1950s, did not show up in the consumer price statistics until 1978, after its price had fallen well below $100. And the problem is not just price. "Statisticians keep track of cost," says Cox. "The economy produces worth-what people want." His term for the resulting unmeasured but desirable benefits like greater convenience, choice, safety, speed: "the silent boom." It rolls on. -------------------------------------------------- Barry

To: Steve Porter who wrote (59750)	7/12/1998 12:17:00 PM
From: DownSouth	Read Replies (2) \| Respond to of 186894

>the market is a bloody (literally) mess.. why? All because of AMD.. Good posting. The long term view could be argued thusly: The pricing wars has brought a whole new segment of users into the market sooner that could have been predicted without the wars. The sub $1000 PC buyer. As the chip wars inevitably will result in further shakeout, with AMD an others falling by the wayside of the mainstream, INTC is left with a larger set of computer users ready to upgrade to the latest technology in a year or two. So the consumer use of PCs has been accelerated and INTC will be the ultimate benefactor (and MSFT and CSCO). IMHO, of course.

To: Steve Porter who wrote (59750)	7/12/1998 12:35:00 PM
From: gnuman	Read Replies (1) \| Respond to of 186894

Steve Porter, Re: "the market is a bloody (literally) mess.. why? All because of AMD.. " I think you're laying the blame too narrowly. AMD couldn't do it alone. You have to include Compaq, IBM, HP, et al in this statement. If they hadn't provided "Brand recognition" and support to the AMD product, do you think AMD would have as much impact? The makers are involved in this as much as AMD. I think Intel is reaping the downside of not playing the game the way the makers wanted.