AMD + Dell deal supposed to be huge. (inquirer grain of salt alert)

[Zebo]

http://www.theinquirer.net/default.aspx?article=33462

A wise but nameless man was talking to me about AMD's plans at Computex last year, just about the time when Turion notebooks were actually poking their heads out of the ground after a long winter. He said that AMD had a long term plan, first servers, then laptops, then desktops. They were on servers, and I was seeing laptops. I corrected him and said 'don't you mean servers, desktops and then laptops, you already own the retail desktop market'. He grinned. Silly reporter, no cookie.

Dresden clean roomThe desktop assault begins now. You saw the Lenovo deal, and various other bits and pieces, but it is time for the real launch to begin soon. The raw numbers we hear are above 10 million CPUs, but the time frame keeps changing. Some people say hard targets of three to four million CPUs a quarter, other give mildly different variations. Several sources are pointing at 33-50% of Dell business desktops in the near future. This deal is as big as you can get, and will cut across servers, desktops and laptops.

If you do the sums, and about 60 million CPUs are sold a quarter, this will boost AMD's market share by about five points or so, pushing it perilously close to the 30% it keeps talking about. This is going to change a lot of long held beliefs about what the industry is, and who holds what power.

AMD can't really compete on raw power once Core2SquaredDuoDeuxWhatever ramps, but can compete on price. Looking at the numbers from the excellent HP 63xx line series laptops, the AMD price advantage is $180, not an insubstantial sum. If you are buying 1,000 of them, do you worry about 30 minutes battery life or a 15 plus per cent discount? AMD is going to do the same in Dell laptops, and may be able to significantly undercut Intel there too.

The end result, if it is only half as big as we are hearing, will drive huge business to AMD, Nvidia and of course ATI, which makes the timing of the buy pretty fortuitous. If you doubt this is anything less than game changing and huge, ask yourself how stupid this man is.µ

I wish AMD luck but frankly I don't understand why now? With an inferior architecture with Core online, as opposed to the last three years IMO, where, AMD really did have it going on. So dells saturation deal does'nt make sense to my mind. Then the consumers will have to buy it after that which is even more unlikly.

 

[CyborgNinja117]

i remember about them talking about the deal long time ago, but i bet dell is aiming those amd cpus to low end market

 

[AnonymouseUser]

Originally posted by: Zebo
I wish AMD luck but frankly I don't understand why now? With an inferior architecture with Core online, as opposed to the last three years IMO were AMD really did have it going on. So it does'nt make sense to my mind.

The Intel monopoly is over.

Core 2 cannot save Dell alone since Intel's Core 2 production will only be up to 20% by Q4. Dell cannot survive much longer with $500 Pentium 4/D systems.

 

[Zebo]

Originally posted by: AnonymouseUser

Originally posted by: Zebo
I wish AMD luck but frankly I don't understand why now? With an inferior architecture with Core online, as opposed to the last three years IMO were AMD really did have it going on. So it does'nt make sense to my mind.

The Intel monopoly is over.

Core 2 cannot save Dell alone since Intel's Core 2 production will only be up to 20% by Q4. Dell cannot survive much longer with $500 Pentium 4/D systems.

Excellent point about transition time AMD still holds more good processors than intel.

 

[myocardia]

Originally posted by: Zebo
Excellent point about transition time AMD still holds more good processors than intel.

That's a good point, they actually have warehouses of 939 and 754 chips. They don't have many AM2's, though. At least, not that I know about. This is my favorite part of this thread, though:

(inquirer grain of salt alert)

 

[Regs]

Well if you want to believe the Inquirer, you may also want to believe that what AMD's reps are saying there will be a "proper" response to conroe.

 

[myocardia]

Originally posted by: Regs
Well if you want to believe the Inquirer, you may also want to believe that what AMD's reps are saying there will be a "proper" response to conroe.

I don't trust anything the Inq says, either, but they're not always wrong. And when they're right, they're almost always first with the news. For instance, the AMD price drops.

 

[VivienM]

Originally posted by: Zebo

I wish AMD luck but frankly I don't understand why now? With an inferior architecture with Core online, as opposed to the last three years IMO, where, AMD really did have it going on. So dells saturation deal does'nt make sense to my mind. Then the consumers will have to buy it after that which is even more unlikly.

Why now?

How about the following: Dell had enough when Intel started bending over backwards for Apple?

Let's see here...
- Apple insults Pentiums in its previous advertising and would have looked hypocritical putting Pentiums in its boxes; Intel "coincidentally" abandons the Pentium name on chips as Apple starting buying them (I have a feeling Dell would have liked C2D to be the Pentium VI or something; it would have made their marketing easier)
- Apple gets Yonah first
- The C2D release date is timed to coincide with WWDC
- Apple promotes its new products by calling Dell's products "boring little boxes" on TV
- Apple is increasing its profit margins by using processors/chipsets/etc developed with Dell's money (just how much of Intel's revenue came from Dell the past few years? must be huge) instead of making its own custom stuff like it used to

I suspect Dell could put up with the NetBurst issues, but when Intel betrays them this way?

Otellini may have thought it would be good for Apple's "cool" hardware to have Intel Inside, but I think Messrs. Rollins & Dell want to remind Otellini that Apple's "cool hardware" contributes way less to Intel's bottom line than Dell's "boring little boxes". And a big deal with AMD is one hell of a way to remind Otellini of this...

 

[Zebo]

Originally posted by: VivienM

Originally posted by: Zebo

I wish AMD luck but frankly I don't understand why now? With an inferior architecture with Core online, as opposed to the last three years IMO, where, AMD really did have it going on. So dells saturation deal does'nt make sense to my mind. Then the consumers will have to buy it after that which is even more unlikly.

Why now?

How about the following: Dell had enough when Intel started bending over backwards for Apple?

Let's see here...
- Apple insults Pentiums in its previous advertising and would have looked hypocritical putting Pentiums in its boxes; Intel "coincidentally" abandons the Pentium name on chips as Apple starting buying them (I have a feeling Dell would have liked C2D to be the Pentium VI or something; it would have made their marketing easier)
- Apple gets Yonah first
- The C2D release date is timed to coincide with WWDC
- Apple promotes its new products by calling Dell's products "boring little boxes" on TV
- Apple is increasing its profit margins by using processors/chipsets/etc developed with Dell's money (just how much of Intel's revenue came from Dell the past few years? must be huge) instead of making its own custom stuff like it used to

I suspect Dell could put up with the NetBurst issues, but when Intel betrays them this way?

Otellini may have thought it would be good for Apple's "cool" hardware to have Intel Inside, but I think Messrs. Rollins & Dell want to remind Otellini that Apple's "cool hardware" contributes way less to Intel's bottom line than Dell's "boring little boxes". And a big deal with AMD is one hell of a way to remind Otellini of this...

Interesting... But isn't Dell going to lose those wholesale chip prices and rumored Intel paying for thier glossy fliers you get in the mail? Seems like a big financial risk Dell is taking just to teach Otellini/intel a lesson. AMD can't play Intels game. They don't have the money and even if they did it's debatable if they could supply enough AMD procesors to a place like Dell to make such wholesale pricing and ad placement profitable like intel had. Then, again, you have to whole issue of demand. Will the consumer demand even be there for Dell to stab Intel right back with 30-50% AMD shipments? Good luck with that as Intel is chart topping and Joe Six pack does'nt know a Core form a power whore (PentiumD) all he sees and hears is Intel is top dog and will buy intel.

 

[VivienM]

Originally posted by: Zebo

Interesting... But isn't Dell going to lose those wholesale chip prices and rumored Intel paying for thier glossy fliers you get in the mail? Seems like a big financial risk Dell is taking just to teach Otellini/intel a lesson. AMD can't play Intels game. They don't have the money and even if they did it's debatable if they could supply enough AMD procesors to a place like Dell to make such wholesale pricing and ad placement profitable like intel had. Then, again, you have to whole issue of demand. Will the consumer demand even be there for Dell to stab Intel beck with 30-50% AMD shipments? Good luck with that as Intel is chart topping and Joe Six pack does'nt know a Core for a power whore (PentiumD) all he sees and hears is Intel is top dog and will buy intel.

If Joe SixPack knew or cared who the top dog was, Dell would have been in serious trouble being Intel-only a long time ago. So that's not a concern...

It may be a big financial risk, or it may not be... if in a quarter or two, Intel is hurting because Stevie J. just can't match Dell's volume, maybe Otellini will be forced to head to Dell HQ and offer lower prices to get Dell back. I just think it was a HUGE mistake for Otellini to court Apple's business as aggressively as he did. It may look good on Wall Street, but... Wall Street matters less than your big loyal customers.

I just think that when Stevie J. stands up Monday morning, and says HIS C2D boxes are now shipping, are the first C2D boxes in the industry to ship, and are now in STOCK at the Apple stores, Messrs Rollins, Dell, & co are going to be screaming mad at Intel. And knowing Stevie J. and his audience, he WILL want to gloat about his influence on Intel, if only to reassure the loyalists in the room that he didn't make a huge mistake dumping PPC. That'll just piss off Dell execs some more... this little UPSTART (in the Intel world) that just a few years ago insulted Pentiums now having the ability to set Intel's release schedule!?!

Plus there's antitrust... That may prevent Intel from doing anything too drastic to "punish" Dell.

 

[Zebo]

Originally posted by: VivienM

Originally posted by: Zebo

Interesting... But isn't Dell going to lose those wholesale chip prices and rumored Intel paying for thier glossy fliers you get in the mail? Seems like a big financial risk Dell is taking just to teach Otellini/intel a lesson. AMD can't play Intels game. They don't have the money and even if they did it's debatable if they could supply enough AMD procesors to a place like Dell to make such wholesale pricing and ad placement profitable like intel had. Then, again, you have to whole issue of demand. Will the consumer demand even be there for Dell to stab Intel beck with 30-50% AMD shipments? Good luck with that as Intel is chart topping and Joe Six pack does'nt know a Core for a power whore (PentiumD) all he sees and hears is Intel is top dog and will buy intel.

If Joe SixPack knew or cared who the top dog was, Dell would have been in serious trouble being Intel-only a long time ago. So that's not a concern...

It may be a big financial risk, or it may not be... if in a quarter or two, Intel is hurting because Stevie J. just can't match Dell's volume, maybe Otellini will be forced to head to Dell HQ and offer lower prices to get Dell back. I just think it was a HUGE mistake for Otellini to court Apple's business as aggressively as he did. It may look good on Wall Street, but... Wall Street matters less than your big loyal customers.

I just think that when Stevie J. stands up Monday morning, and says HIS C2D boxes are now shipping, are the first C2D boxes in the industry to ship, and are now in STOCK at the Apple stores, Messrs Rollins, Dell, & co are going to be screaming mad at Intel. And knowing Stevie J. and his audience, he WILL want to gloat about his influence on Intel, if only to reassure the loyalists in the room that he didn't make a huge mistake dumping PPC. That'll just piss off Dell execs some more... this little UPSTART (in the Intel world) that just a few years ago insulted Pentiums now having the ability to set Intel's release schedule!?!

Plus there's antitrust... That may prevent Intel from doing anything too drastic to "punish" Dell.

hehe Would'nt that be something, Dell singing like a bird in front of Federal court about Intels practices.. now *THAT* would be some sweet revenge. As they say in Business: Pigs get fat hogs get slaughtered... It'l be interesting to see how this plays.

 

[Viditor]

This is also talked about in this thread

To reiterate what the Inq is saying...

"In line with recent investor speculation," Pacific Crest's Michael McConnell said, "we have confirmed that Dell plans to broaden its supplier relationship with AMD in the second half of 2006."

He says Dell is already preparing desktop computers based around AMD's Athlon-64 processor, which are targeted towards the consumer markets. These systems are expected to ship in the third fiscal quarter, which ends October.

Notebook computers are also in development and will be based around AMD's Turion-64 mobile processors. They are expected to ship in the first quarter of 2007, he said. Official details should be announced at the Dell's August 17th earnings conference call, or during its analysts day in September, McConnell said.

The worlds largest computer manufacturer has targeted an initial ramp of 1.2 million AMD-based desktop and server units for its third quarter. This, McConnell elaborates, represents 16 to 17 percent of the company's projected desktop and server units in aggregate.

 

[Viditor]

Originally posted by: Zebo



hehe Would'nt that be something, Dell singing like a bird in front of Federal court about Intels practices.. now *THAT* would be some sweet revenge. As they say in Business: Pigs get fat hogs get slaughtered... It'l be interesting to see how this plays.

Not too far-fetched though...the former Co-Chairman of the Board for Dell is now on the AMD Board of Directors.

 

[zsdersw]

I find it very far-fetched that Dell would complain to the court about Intel's business practices, considering they used to benefit so much from them.

As it is with most things, the simplest solution or explanation tends to be the right one.. and I'd bet the simplest explanation is simply a supply disparity between Netburst products and Core 2 products that's going to be relatively short-lived compared to the time Intel and Dell have had with each other.

 

[SuperSix]

What everyone is missing here is Intel's gargantuan marketing/advertising budget/machine.

And yes, Joe Six Pack DOES know Intel, may not be as familiar with AMD, and unless the box is MUCH less expensive, he will go Intel.

Yes, C2D will be constrained for a quarter or so, but it will take Dell/AMD that long to ramp up (if not longer), and by then, Intel's superior production capacity, and ability to control the market with pricing will seriously impact the amount of AMD units Dell sells.

Good luck to AMD, they may have poked the bear one time too many, they are right back where they were 4-5 years ago.

 

[aldamon]

Originally posted by: VivienM
- Apple insults Pentiums in its previous advertising and would have looked hypocritical putting Pentiums in its boxes; Intel "coincidentally" abandons the Pentium name on chips as Apple starting buying them (I have a feeling Dell would have liked C2D to be the Pentium VI or something; it would have made their marketing easier)

OK, I'm a moron. I never put "Apple" and "Core" together before in my head. LOL. What you say makes perfect sense to me.

Also, the MHz war may be alive and well in Dell's eyes. AMD's chips have higher MHz ratings now on their boxes when compared to C2D.

Originally posted by: Regs
Well if you want to believe the Inquirer, you may also want to believe that what AMD's reps are saying there will be a "proper" response to conroe.

Yeah, but in what year? I keeeeeed, I keeeeeed. I would jump back to AMD in a heartbeat. I feel dirty with a Core 2.

 

[Viditor]

Originally posted by: SuperSix
What everyone is missing here is Intel's gargantuan marketing/advertising budget/machine.

And yes, Joe Six Pack DOES know Intel, may not be as familiar with AMD, and unless the box is MUCH less expensive, he will go Intel.

Yes, C2D will be constrained for a quarter or so, but it will take Dell/AMD that long to ramp up (if not longer), and by then, Intel's superior production capacity, and ability to control the market with pricing will seriously impact the amount of AMD units Dell sells.

Good luck to AMD, they may have poked the bear one time too many, they are right back where they were 4-5 years ago.

Some serious spin there...

1. At the 2 computer shops I do consulting for, more customers have requested AMD than Intel by a fairly hefty margin (for the past 9 months or so...).
2. Dell alone is shipping 1.2 million AMDs THIS quarter, which is about 20% more than the total number of Conroes Intel expects to ship worldwide over the first 7 weeks (a little over half the quarter) of it's release.
3. As Dell is shipping that many systems this quarter, obviously they have already been ramping up...
4. 4-5 years ago, AMD had only one major Fab, a 0% marketshare in servers, and no Tier 1 OEMs...today they have 2 major Fabs and access to a third for overflow (with 2 more on the way), close to a 30% marketshare in servers and growing, and ALL the Tier 1 OEMs! And we won't even mention the fact that the lawsuit has forced Intel to pull back hard on the "marketing tactics" they used back then...

BTW, even with Intel's huge price cuts, AMD still gained market share last quarter...
Article

According to data released from Mercury Research, AMD's market share was able to increase slightly, despite PC processors shipments decreasing by 7 percent quarter-over-quarter. AMD's unit shipment increased to 22 percent, and the revenue share increased to 18 percent - at the expense of Intel

 

[zsdersw]

Still not working very hard on being not so much of an AMD cheerleader, are you Viditor.

 

[imported_inspire]

Just nice to see AMD expanding beyond just developing chips. They're starting to address issues that have held them back for a long time. Viva competition!

 

[Viditor]

Originally posted by: zsdersw
Still not working very hard on being not so much of an AMD cheerleader, are you Viditor.

That's not cheerleading, mate...that's teaching.

 

[zsdersw]

Originally posted by: Viditor
That's not cheerleading, mate...that's teaching.

It's not teaching when you only teach things that are pro-AMD. You should teach things that are pro-Intel as well.

 

[imported_inspire]

Meh, we have plenty of Intel cheerleaders - if Viditor knows more about AMD, then I don't mind him telling us what he knows. It takes some time to be equally educated in both camps, and not everyone has that kind of time. I mean, sure it'd be nice if he equally represent Intel and AMD, but....

 

[Viditor]

Originally posted by: zsdersw

Originally posted by: Viditor
That's not cheerleading, mate...that's teaching.

It's not teaching when you only teach things that are pro-AMD. You should teach things that are pro-Intel as well.

To be fair, I have done just that on many occasions (as I'm sure many in the forums can attest...).
But are you saying that you agree with supersix's assessment?

 

[justly]

zsdersw stop throwing those stones, you might just break your glass house.

I can't say for certain that I have read every single one of your posts, but the ones I have read don't paint you as totally unbiased. Then again maybe I'm wrong, so I'll ask you what would Viditor have to do to prove (to you) he is not cheerleading. If 25% of his posts where pro-intel would that suffice? would he have to conceal his positive knowlage and sound opinions about AMD?

Honestly I don't think you can accuse Viditor of being a cheerleader without looking into a mirror and claiming the same for yourself.

 

[zsdersw]

Originally posted by: ViditorTo be fair, I have done just that on many occasions (as I'm sure many in the forums can attest...).
But are you saying that you agree with supersix's assessment?

I'd like to see where you have. None of your posts I've read suggest anything of the sort.

I'm not saying at all that I agree with anyone.

I can't say for certain that I have read every single one of your posts, but the ones I have read don't paint you as totally unbiased. Then again maybe I'm wrong, so I'll ask you what would Viditor have to do to prove (to you) he is not cheerleading. If 25% of his posts where pro-intel would that suffice? would he have to conceal his positive knowlage and sound opinions about AMD?

Honestly I don't think you can accuse Viditor of being a cheerleader without looking into a mirror and claiming the same for yourself.

Viditor certainly doesn't have to do anything to prove anything to anyone.. least of all to me. Everything I've been saying is simply my opinion. He can either choose to value it by attempting to demonstrate that I'm wrong or he can ignore it and move on. The choice is ultimately his.