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

To: Thomas M. who wrote (57584)	5/7/1999 2:58:00 PM
From: Tenchusatsu	Read Replies (1) \| Respond to of 1571892

<AMD is selling K6's as fast as they can make 'em.> Well, anyone can sell 'em as fast as they can make 'em if they charge non-profit prices. <Remember, your original assertion is that the K7 would not be accepted in the server/WS market, regardless of price. Obviously, if AMD had similar success with the K7, they would make a lot of money because there is much more room for price cutting in this market.> There are too many factors that you are discounting in your assumption that the K7 can easily follow in Xeon's footsteps. One of those factors is Intel's ability to make a "cookie-cutter" reference design. All of the OEM's (Dell, for instance) who want to save on R&D costs can follow the cookie-cutter design and introduce Xeon servers at low, low price points. In effect, Intel commoditizes the heck out of x86-based servers and workstations, and enjoys the profits as the OEM's duke it out. Meanwhile, AMD has to create their own cookie-cutter design out of an Alpha platform that might or might not be suited for such a task. It doesn't matter how cheap the CPU is; if the K7 server platform isn't good enough, OEM's will have to "cut their own cookies," which adds to the cost of the entire server. This might not affect K7 servers from Compaq, because they own the Alpha-based platform to begin with. But this will definitely be a factor for other OEM's like Dell, HP, Unisys, etc. And this is just one factor. There are many other factors involved as well, like chipset performance, OS support (yes, the OS needs to be specifically tuned for K7 or Xeon to realize maximum performance), supply and availability, and of course overcoming Intel's solid reputation in this market. And like I said before, if I'm wrong and K7 does succeed on price alone, then Intel still has the option to slash prices on Xeon. This will hurt Intel's bottom-line, but it will KILL AMD's profitability. And that's something that AMD really can't afford. Tenchusatsu