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To: Mark Oliver who wrote (1102)	10/21/1998 12:14:00 AM
From: Pierre-X	Read Replies (2) \| Respond to of 2025

From an -INVESTMENT- standpoint, I personally am not now entertaining, nor have ever entertained the possibility of a long position on AMD. To me, the simple fact is that Intel has such incredibly high gross margins in this business that Intel could crush AMD as a company by simply tightening their belts for a while and dropping prices a bit faster than the plan. If you believe in conspiracy theories, you might consider that Intel basically likes to have AMD, Cyrix et al. around as "competitive exhibits" to show off whenever various regulatory parties make anti-trust noises. Clearly smaller geometries should result in better device yields on a per-wafer basis but this is hardly unique to AMD. You characterize AMD as a "follower"; I offer a better characterization of "desperate chaser". Intel did indeed get caught completely with their britches down in the cheap CPU explosion but it took them less than a year to completely turn the tables. It was AMD's window of opportunity--had they executed better their position right now would be strong indeed, but true to form they fumbled the ball and now it's back to the 20. Again. Note that AMD is in four distinct lines of business as described by Sanders (MPU, RAM, Comm, ASIC?) and in none of those is it a market leader. Back to you--