AMD will die within five years

[buleyb]

Originally posted by: Ice9


Some will argue the typical BS of intel being more than just CPU's. Well, if you think that .01% of the market is bolstering those kind of numbers, think again. I don't think Intel is selling enough phone line networking kits to rake in a cool billion per quarter.

I'll be one of those people, because I believe they make a good deal more in their non-desktop/server CPU markets than you say. Back it up with stats and support and I'll subscribe to your newletter...until then, continue mindless ranting...

2 other picks for companies that won't be around in 5 years out of gross stupidity:
Micron/Crucial (losing $3 million per day for the past 2 years, thanks to everyone's favorite memory type: DDR)
Hynix Semiconductor (Same, only reason they're alive now is because the korean government keeps bailing them out.)

Hynix, yes, they'll go somewhere, Micron/Crucial? Nah...They take a loss in their memory because they can afford to, and plan to. They aren't accidentally doing it, and they know their limits. If anything, Crucial will be shutdown or changed to break even, but MT won't be going anywhere while we still need memory...

 

[Bovinicus]

I still don't think they are going to die. I'm not saying it's impossible, but their flash memory business should keep cash flow coming in enough to hold them up. The Athlon64 is a good idea, because "joe six-pack" might know about more bits being better from the console world. This would give them some good PR opportunities. Plus, the server market will be jumping all of the processor. It's not impossible, but I would wait to see what happens in the next year or two before I would start making predcitions like that. They have been around for 30 years or so now. They have always hung around as a small company and managed to get by; I hope they can continue.

 

[Ice9]

Intel's numbers are public. Look up their latest 10Q filing, which states:

"For Q3 2002, a majority of our consolidated net revenues and a substantial majority of our gross margin came from sales of the Intel(Registered Trademark) Pentium(Registered Trademark) 4 microprocessor and related microprocessors based on the Intel(Registered Trademark) NetBurst(Trademark) microarchitecture, as well as related chipsets and motherboards."

Read it here.

And Micron taking a loss because it's planned? Then why did they just have to borrow $500M just to stay in business this quarter?

You are obviously grossly misinformed. Micron is teetering on the brink of bankruptcy. I give them a year. Less if sales improve.

 

[paralazarguer]

Apple is going to die in 5 years. It's my prediction.
Also, Um....let's say, erm...maxtor, dead in 6 months. My prediction.
How about...erm...VIA, yeah that's as good as anyone, they'll be dead within three years. Because I say so...
so many guesses...guesses, guesses...

 

[Ice9]

Meager profits in Flash Memory are NOT enough to hold up AMD. Putting on a band-aid after having your hand bit off by a crocodile is not very effective.

This is WHY they've burned through 15 years of profits in the past year. When a company has an unprofitable division, sell it off, spin it off, whatever. Get rid of it. That's what usually happens. AMD doesn't have that luxury, it seems.

I think what's going on here is some wishful thinking. The time for youthful idealism must eventually give way to cold hard fact: AMD isn't making any money, and with the creaming they're taking from intel, they have no hope of doing so anytime soon.

Intel, on the other hand, has PLENTY of room for markdowns, price wars and discounts to huge manufacturers.

Don't get me wrong, Competition is good for the market, but only when the competition has a snowball's chance in hell of competing.

 

[dullard]

Originally posted by: Ice9
AMD isn't making any money, and with the creaming they're taking from intel, they have no hope of doing so anytime soon.

This thread must have awaken something lying deep inside you. 3 posts today and 9 posts the previous 1.5 years. Just kidding.

They were making some good profits when they had top chips selling for $600+. But from March 2000 to March 2001, AMD slashed their prices - their top chip release price dropped from $1299 to $350. The last quarterly profit AMD ever made was 1st quarter of 2001. This isn't a coincidence - slash prices, and profits vanished. They tried even more slashes, down to the 2400+ being released at $193 (if you were lucky to get your hands on it right away). Money losses continued. They could try slashing even further, all the way down to giving them away for free, and AMD still wouldn't be making a profit.

I think AMD is finally seeing the light. Their processor release prices have since steadilly risen with each chip, all the way up to $397 with the limited edition 2800+ Tbred. The 3000+ Barton seems to have a starting price of over $600. Hammer supposedly has a significant price premium over that. Rising prices and AMD will finally see a profit. Lets just hope AMD will keep them high enough and long enough to avoid any more losses.

 

[Ice9]

Eh, one big price cut from intel, and AMD is back to losing $1B a year. And intel drops its profits to only $500M per quarter.

*yawn*.

I just think the company is being infinitely stupid in the way they're trying to compete. I don't want 'em to go away or anything, since Intel's been on its toes for a long time as a result of their increased competition.

 

[JellyBaby]

I'm not looking forward to return of high chip prices and leisurely new chip releases from a single producer. Been there, done that and paid for it.

It almost looks like everything has to go right for AMD for the next year or two in order for them to endure. And that's somewhat of a long shot.

 

[frogster220]

I wouldn't count AMD out anytime soon. They are smaller and leaner than Intel. They've made a lot more cost cutting moves than Intel which could allow future price decreases that Intel won't be able to match. They've gone from producing cheap processors that were inferior to Intels to producing cheap processors that are superior to Intel's. Also, the number of motherboards and chipsets that work with AMD processors has never been greater. Intel is built on a house of cards, mainly their current market share. They don't have a viable 64 bit processor out there. If AMD can nibble out a little more market share, look out.

 

[Alptraum]

Originally posted by: Bovinicus
Plus, the server market will be jumping all of the processor.

If by that you mean jumping on it, don't hold your breath. I have been involved in purchasing servers for the last 5 years or so. I am certianly not going to buy something when it first comes out, at least for work. By far the majority of other people buying business class servers are the same way. Thats why its so hard to break in to the market. We want something thats been around awhile before we sink a shitload of money into it.

I do have a lot of interest in the Opteron, as do many other people. But if you think they are going to sell like hotcakes right off the bat you are mistaken (at least based on the way the business market has reacted to any other new thing). I'll probably buy one server based on Opteron when its been out for a month or two as a test server to see how it does. And I bet thats going to be the most common response. Actually that will most likely be the 2nd most common response, the most common will probably be just a sit and watch approach.

I don't expect Opteron to have any significant market penetration for at least 6 months if not a year or more. Sure there are a few large exceptions like that one huge supercomputer, but that is the exception not the norm.

 

[Ice9]

AMD is neither small nor lean.

Get a clue about the company before you make generalizations like that. Take a look at their operating expenses. Look at what they're declaring as profits. Look at how they're spending their money.

They're bleeding money, which is not a tactic of the small, lean or competitive. If amd had MORE market share, it would make NO impact on Intel. All it would do is widen AMD's loss as they are losing money on every cpu they sell.

 

[ASIMOS]

AMD has one big problem:THEIR MARKETING DEPATRMENT
It is an excellent company from a technology point with good research & development and great understanding of technology.It is no way behind Intel in technology field.
The thing is that Intel made an excellent Marketing move with this Gigahertz war.
But the problem is elseware.You know you can't pretict every move your opponent will make but you surely must be prepared for an unexpected move.You have to leave room for yourself to react.
If you check the prices of AMD the Last three years you will see That the prices of AMD proccesors is uneccerally way to cheaper than their Intel equivalent.For example:
AMD XP 1700+ 53$ 69$ BELOW THE INTEL PENTIUM4 1700 OR 2$ BELOW THE (LOW END)INTEL CELERON 1700
AMD XP 2100+ 86$ 76$ BELOW INTEL PENTIUM 4 2000(A)
AMDs marketing department is scrueing AMD.
You can't have half the price of the competition in order to sell.You must doing something fundamentally wrong.
If Intel have a proccesor in the 150$ the equivalent AMD SHOULD NOT HAVE 70$ in order to sell.Instead the AMD should be around 120$ and certainly no less than 110$ in order for AMD to have the opportunity to responce to a unexpected move by Intel.If 120$ sounds a lot to your ears it is because AMD marketing department take care for it 3 whole years.This of cource is not the only problem AMD have but is the mother of all problems to the company.

 

[Miramonti]

Intel won't kill AMD but the economy might. While Intel needs to hold on during the downturn, AMD can't afford to just maintain because they are losing tons of money right now and that has serious implications to R&D of future products and releases. Intel has them by the bawls right now and AMD is pretending that they are strong enough to handle it, but its a serious crisis right now for them. If their new processors this year don't give them a good jump in market share, say goodbye imo (atleast say hello to bankruptcy court).

 

[Ice9]

Intel won't kill AMD but the economy might. While Intel needs to hold on during the downturn, AMD can't afford to just maintain because they are losing tons of money right now and that has serious implications to R&D of future products and releases. Intel has them by the bawls right now and AMD is pretending that they are strong enough to handle it, but its a serious crisis right now for them. If their new processors this year don't give them a good jump in market share, say goodbye imo (atleast say hello to bankruptcy court).

Intel kinda NEEDS amd to keep antitrust regulators off their backs. But... to make 'em SUFFER is a good thing. If they went away completely, it would be a combination of Intel's doing in addition to their own stupidity. Intel is AMD's only competition, in case you haven't noticed, so you have to place SOME of the "blame" on them, the rest on the idiots who thought it was a good idea for a midget to take on an 800lb gorilla in a turf war.

Intel's idea of "holding on during a downturn" (which has been happening for the past year at least) is to do the same thing they've always done. Intel has a trend of saying "Oh, god. This quarter is gonna suck, hold on to your hats, we're going to be hurting!", only to make a $1 billion profit at the end of the quarter and wind up smelling like a rose to investors. Sure, they're dragged down by the rest of the semiconductor market stock-wise, but make no mistake. Intel is *NOT* hurting for money.

AMD on the other hand, loses several hundred million buckaroos because they're using THEIR only business tactic: Firesaling CPU's to enthusiast fanboys who believe they're "the winner".

AMD hasn't maintained a year of profitability since they decided to DIRECTLY compete with Intel with the athlon. Year after year, it's the same thing. Maybe one quarter of profitability (which I think happened in 2000 or 2001), followed by huge losses the rest of the year that wipe out any of their gains. Then tack on the new fab in dresden that costs them a fortune to operate, R&D costs for a 64 bit processor that 0.0005% of the market wants, and generally stupid youthful idealism, and you have a recipe for disaster in the american stock market. It's sad, really. They should have stuck to "knowing their role" of developing crippled FPU processors for the ghetto PC market. They were at least PROFITABLE then.

 

[bgeh]

Originally posted by: ASIMOS
AMD has one big problem:THEIR MARKETING DEPATRMENT
It is an excellent company from a technology point with good research & development and great understanding of technology.It is no way behind Intel in technology field.
The thing is that Intel made an excellent Marketing move with this Gigahertz war.
But the problem is elseware.You know you can't pretict every move your opponent will make but you surely must be prepared for an unexpected move.You have to leave room for yourself to react.
If you check the prices of AMD the Last three years you will see That the prices of AMD proccesors is uneccerally way to cheaper than their Intel equivalent.For example:
AMD XP 1700+ 53$ 69$ BELOW THE INTEL PENTIUM4 1700 OR 2$ BELOW THE (LOW END)INTEL CELERON 1700
AMD XP 2100+ 86$ 76$ BELOW INTEL PENTIUM 4 2000(A)
AMDs marketing department is scrueing AMD.
You can't have half the price of the competition in order to sell.You must doing something fundamentally wrong.
If Intel have a proccesor in the 150$ the equivalent AMD SHOULD NOT HAVE 70$ in order to sell.Instead the AMD should be around 120$ and certainly no less than 110$ in order for AMD to have the opportunity to responce to a unexpected move by Intel.If 120$ sounds a lot to your ears it is because AMD marketing department take care for it 3 whole years.This of cource is not the only problem AMD have but is the mother of all problems to the company.

ASIMOS, imo, AMD sells at such low prices because 99% of the general population think that AMD is inferior the the Pentium 4(or even maybe the Celeron too). so AMD has to drop prices to appeal to cash strapped people who want to buy computers.
i use my father for example. he is the manager of a company but he swears off AMD for his company even though he admits my AMD system at home is stable and fast.

 

[Novgrod]

[removed to remove offense]

AMD is a microprocessor company. The life of a microprocessor company depends on r&d. AMD is forced to commit to the hammer, and to commit immense quantities of money to the hammer, because without a new and unique chip AMD is down the poophole sooner or later.

Unlike Intel, which has the luxury of devoting money to marketing and to various types of cpus, AMD does not.

Ice9, it's well and good to criticize AMD's plans, since obviously they're failing, but they don't have another option. In the world of microprocessors, there is no such thing as small and lean. There is successful or there is dead, and when the market is stagnant there is rarely more than dead. You can claim that AMD would be better off if it hadn't focused on the Hammer, but it made that decision before the entire tech industry was tossed out into the street with the rest of the contents of the poopy pot. And don't tell me you saw that coming. It could not invest all its efforts into a chip and then change directions and come out with something that can only compete, not dominate.

I for one applaud AMD for looking for a niche, and for a new and unique product, and giving that product its all. I applaud them for providing me with cheap cpus. I applaud them for keeping Intel in line and I'll keep buying their cpus accordingly.

So don't fault AMD for what they've done. None of it--more money in the bank, more marketing, focusing on something to compete more directly on a 32 bit level in the coming years would have saved them in this market. In a sideways market within an industry that demands growth and new products, the bigger company with more money will win. By trying to make a unique product that could succeed where Intel has its proverbial pants down, AMD has the best chance possible at success. Sure it's slim, but it's still there. Don't fault them for making CPUs either; it's what they do.

Furthermore, as long as I'm going off, with the present nature of the SEC, anybody who files an antitrust suit against Intel will need really conclusive proof that they acted in an anticompetitve manner. Intel has been exonerated on numerous occasions of just such charges, and being able to market a brand more doesn't cut the mustard for illegal behavior. It's just the nature of such high-growth companies that require such immense funds running into R&D that the bigger company can funnel more money where it needs to go and it can win. It's amazing AMD has come this far.

Heck, look at Nvidia and 3dfx and ati--what was once a market with a great number of companies now has two, and every day somebody is promising the death of Nvidia.

 

[Bovinicus]

I don't expect Opteron to have any significant market penetration for at least 6 months if not a year or more. Sure there are a few large exceptions like that one huge supercomputer, but that is the exception not the norm.

I agree; it will take time to penetrate the market, but once it becomes a little more tried and true there will be more people willing to jump on it. It will definitely catch a lot of people's interests. As you said, you think the most common approach will be to sit and watch. If the results are good, then those who take that approach will be glad to jump on it. There won't be mass quantities of Opterons available for a few months anyway.

 

[PreDatoR]

Ice9 = Intel fanboy can hear it in his voice... something must have crawled up his ass and awaken him... 2.5yrs 16 posts only to come here and bash AMD what a chump...

 

[Ice9]

Predator,

I'm far from a "fanboy", I just don't believe in AMD, and I don't have to. Since the day they've gone head to head with Intel with the Athlon, they've done nothing but make themselves a loser of a company for themselves and their shareholders. They've blown through every profit they've EVER made, but the AMD fanboys don't care They got their cpu's for cheap, and they don't give a flying **** if it hurts AMD.

It's the fanboys that have hurt AMD more than anything if you ask me Wanna show your loyalty to a struggling little-guy competitor? Pay the same for a 3000+ that Intel buyers pay for P4 3.06's. The average idiot fanboy won't do that. To them, it's not about the company, it's strictly about the price. That's what makes them so rabid. They'll scream about how Intel is "losing market share" to AMD, but they almost never mention that the financial state of their beloved company is completely in the toilet.

And Predator, this is why I rarely post here. Rather than have a debate, the anandtech sewage like yours starts creeping up in the form of "fanboy flames" because your opinion differs from theirs.

-Karl

http://www.weckstrom.com

 

[Novgrod]

Since the day they've gone head to head with Intel with the Athlon, they've done nothing but make themselves a loser of a company for themselves and their shareholders. They've blown through every profit they've EVER made, but the AMD fanboys don't care They got their cpu's for cheap, and they don't give a flying **** if it hurts AMD.

AMD would be screwed right now to an immeasurable extent had they not created the Athlon, which was itself confronted with imminent doom since its beginning. I cannot imagine that anyone could legitimately question AMD's business practices--they gave the market a hell of a wakeup, they gave consumers a hell of a service, and had they not created the Athlon and stuck hey would have faded into nothing, just like Via's CPU plans.

Had the tech market not been kicked swiftly in the nuts, we wouldn't be having this discussion because there would be room enough for multiple competitors, both cranking out a great number of chips. I find it remarkable than anyone can even be critical of AMD, particularly of the athlon because without it, (a) we'd all be much worse off and (b) AMD would have died much earlier.

In summation, it's the economy, stupid. With a good economy AMD could have kept on goin' on making money and threatening Intel. With the economy as it is, reduced purchases => only Intel could survive because it had a better position, not necessarily better technology. That's why AMD will die, if it dies.

 

[Goose77]

OMG ICE... what bug flew up ur a$$!

i dont think amd is goin anywhere. if all else fails they will go back to what they did b4 Athlon.

ICE - if you have read the entire article you will notice that Intel is having a hell of a time getting their 64bit proc to work. I mean my god, they begged IBM the help them with refining their 64bit... i mean its laffable. IBM gave most of the 64bit tech to AMD, MicroSoft is workin with AMD on the 64bit release! No software company wants to work with INTEL to switch to 64bit. AND!!!!

DELL is considering on using opteron!!! wtf is up with that... an INTEL ONLY company is making a change!!!!

i think the bug up ur ass is that things aren't going so wonderful over at INTEL Utopia!!! It seems that u been smoking to much INTEL crack!!

 

[buleyb]

meow

 

[Wingznut]

Originally posted by: Goose77
if you have read the entire article you will notice that Intel is having a hell of a time getting their 64bit proc to work. I mean my god, they begged IBM the help them with refining their 64bit... i mean its laffable. IBM gave most of the 64bit tech to AMD, MicroSoft is workin with AMD on the 64bit release! No software company wants to work with INTEL to switch to 64bit.

What in the world are you talking about???

 

[TheNoblePlatypus]

Thats the good thing about making predictions of this type. In 5 years, no one will remember how stupid you were.....

 

[Goose77]

HP was at work on an ambitious type of chip that embodied a computer architecture called PA-RISC and executed software instructions in parallel, radically improving processing speed. Unlike Intel's chips or the PowerPC, HP's technology was 64 bit. Instead of playing catch-up with HP, Intel CEO Andy Grove persuaded HP's Lew Platt to combine his research with Intel's development efforts. Together they would bear the multibillion-dollar expense of creating the 64-bit architecture of the future


It was a long wait. Itanium did not launch until summer 2001--two years later than originally planned. It was a megaflop. Not only didn't it run 32-bit applications in the way Intel originally promised, but its performance wasn't a convincing improvement over the Pentium.


IBM also knows Itanium's weaknesses better than perhaps any other rival--in part as a result of information divulged by Intel in its quest to win over Big Blue. Says Ravi Arimilli, IBM's chief microprocessor developer: "Intel has had meetings with us asking how they could enhance [the chip] to get us on it. So we're very aware of its limitations."


i think this quote speaks for its self

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