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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Scumbria who wrote (48665)	2/5/1999 2:50:00 AM
From: Paul Engel	Read Replies (1) \| Respond to of 1572507

Slick - Re: "Intel is using profits from non-Celeron business sectors to try and drive AMD out of business." Read and understand the following - it clearly describes Intel's position: "*Intel has never been accused* of maintaining its dominant position through low prices that competitors have difficulty matching! " {=======================================} "To put it another way, it is not illegal to be an 800-pound gorilla, nor is it illegal for the gorilla to wind up with more bananas than the much smaller monkeys and chimpanzees that forage in the same hunting grounds. In a recent appearance before the Senate Judiciary Committee, Federal Reserve Board Chairman Alan Greenspan noted that "...bigness, per se, does not appear to be an issue for national economic policy." Mr. Greenspan went on to observe that while it may be possible for a competitor to dominate a market for an extended period, his view is that "in free competitive markets, that is possible only if dominance is maintained through cost efficiencies and low prices that competitors have difficulty matching." We're encouraged by this view because Intel has never been accused of maintaining its dominant position through low prices that competitors have difficulty matching!** Chairman Greenspan concluded his testimony by noting that "Foremost on the agenda of policy makers, in my judgment, should be to enhance conditions in our market system that will foster the competition and innovation so vital to a prosperous economy." Right on, Alan! Nevertheless, size counts. In the semiconductor industry, it counts for a lot. The capital-intensive nature of the semiconductor industry is legendary. A state-of-the-art wafer fabrication facility today requires an investment of one to two billion dollars. As the industry migrates to more advanced technologies and larger wafer sizes, the capital requirements will only continue to escalate. Further, as factory costs rise, there is a need for an ever-greater throughput to justify the larger investment in production capacity. To put it more simply, if you don't sell in volume, you can't afford the assets to produce in volume. " Staying competitive in the semiconductor industry also requires spending hundreds of millions of dollars annually on research and development to assure a steady stream of competitive process technologies and desirable products. In short, in the semiconductor industry, being big is not only good - it's essential. " {=======================================} Paul