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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Amy J who wrote (81419)	5/24/1999 1:00:00 AM
From: Scumbria	Read Replies (1) \| Respond to of 186894

Amy, However, AMD's current struggles appear to extend beyond what even AMD might be able handle this time around. So, my short-term concern might be: will AMD's K-7 bring Intel's ASPs down as AMD spirals downward in an out-of-control price dumping of chips before plunging into bankruptcy? You are in for some serious surprises! Scumbria

To: Amy J who wrote (81419)	5/24/1999 1:10:00 AM
From: kapkan4u	Read Replies (2) \| Respond to of 186894

<Amy J - re: Maybe Intel should help AMD, just like Microsoft helped Apple> It's too late for Intel to do it. Two years ago Intel made a decision to squash AMD with capital spending, by wildly investing in FABs and process technology. Now Intel is in a downward ASP spiral trying to keep those FABs humming. Kap.

To: Amy J who wrote (81419)	5/24/1999 3:36:00 AM
From: Saturn V	Read Replies (1) \| Respond to of 186894

Ref- 'Maybe Intel should help AMD, just like Microsoft helped Apple. Maybe Intel should help AMD become the chip-of-choice on the low-end market to foster development of PC-based IA's'. I agree that it is not in Intel's interest that AMD go bankrupt. Intel left Cyrix alone when it found niches between the 386 & 486, and again between the 486 and Pentium. At that Cyrix lacked its own Fab, and its manufacturing capacity was limited. However the AMD management has stated publicaly that its goal it to take 40 percent of market share. Intel has to defend its share at all cost. The present practice of anti-trust laws is that you cannot be sued for anti-trust if you protect your existing market share. However if Intel cedes market share for a significant time and then attempts to regain its share by undercutting AMD it can be sued for anti-trust violation. AMD cannot win the market share its management is dreaming about. Its cost of goods is significantly higher than Intel, and its products are perceived inferior, and have to sold 40 percent less than Intel. So the attempt to gain market share against a determined defender will lead to bankruptcy. However if AMD shuts down or disposes of one of its mega fabs, it ceases to be the threat to Intel, and Intel can even help it to survive by ceding it market share in certain segments. A WIN-WIN situation for both ! But will this scenario happen ! Not with the existing management which has its ego invested in acheiving parity with Intel. Any explicit discussion between Intel and AMD is obviously illegal under anti-trust laws. So the scenario I find most plausible is that AMD comes close to bankruptcy, gets bought out, and the new owners bring some sanity to AMD, which is content to live in Intel's shadow, and then Intel allows the 'defanged AMD' to survive by ceding it market share in lower profit areas, or by some licensing agreement.