As hardware enthusiasts, is it wrong to support Intel?

[The Sauce]

Anyone here remember when the top-of-the-line Intel CPU used to cost ~ $1200? What has happened since then? Lower manufacturing costs? Decreased demand? No. AMD happened. And just like DeBeers' attempts to control the diamond market by squashing competition with undercutting, Intel has slased their prices only to undercut AMD and make them unprofitable. As Intel has a much larger war chest they can afford to do this for as long as they have. And so AMD loses money, quarter after quarter, as they are forced to deal with these noncompetitive practices.

And yet I hear members here saying that they buy whatever gives them the best performance at the best price. Well I, for one, will spend a few extra dollars to fight unethical practices and help to ensure a future where competition is possible in the CPU market. I assure you that if AMD is driven out of business by Intel, you will see your beloved Intel CPUs double (at least) in price. And then regrdless of which company you support, you will have half the CPU for twice the price.

 

[Accord99]

Pricing and Availability
AMD is currently shipping its 1GHz AMD Athlon processors priced at $1,299 in 1,000 unit quantities. AMD is also announcing the availability of 950MHz and 900MHz AMD Athlon processors. The 950MHz AMD Athlon processor is priced at $999 in 1,000 unit quantities. The 900MHz AMD Athlon processor is priced at $899 in 1,000 unit quantities.

From the press release hailing the first x86 cpu to break the 1 GHz barrier. Certainly AMD has had an impact on CPU prices but so has the changing market conditions and reduced processor costs. Both are large companies out to try to be as profitable as possible, its not Intel's fault that AMD has faltered in recent months and not able to match Intel's ramp up, thus driving its ASPs down or that there's a major global slowdown in technology.

And I have no doubt, that if the roles were reversed, AMD would be doing the exact same things.

 

[Jhhnn]

I have to agree with you. I see the current trend of returning to Intel as being like voting Republican or fooling around with the wrong woman- it feels good now, but you'll probably pay dearly for it later....

I also suspect that they're massaging the books heavily to maintain both rosy stockholder reports and cutthroat pricing. Maybe the SEC or the Anti-Trust guys will look into it, a la Microsoft- give 'em a slap on the wrist ten years down the road....

 

[Wingznut]

Originally posted by: Snatchface
As hardware enthusiasts, is it wrong to support Intel?

I've never really understood "loyalty" to any corporation. Do you feel the same way about Crest/Colgate, Tide/Cheer, Band-Aid/Curad, etc?

Just buy whichever product suits your needs and budget.

(And that goes for everything... Not just silicon.)

Originally posted by: Jhhnn
I also suspect that they're massaging the books heavily to maintain both rosy stockholder reports and cutthroat pricing.

Why would you suspect that?

 

[JeremiahTheGreat]

because its an american company

 

[The Sauce]

And I have no doubt, that if the roles were reversed, AMD would be doing the exact same things.

I agree! And then I think it would behove us to support Intel...again to support competitive practices.

I've never really understood "loyalty" to any corporation. Do you feel the same way about Crest/Colgate, Tide/Cheer, Band-Aid/Curad, etc?

Dude, you didn't read anything I wrote, did you. There is more to a post than the header...usually.

because its an american company

Huh? They're both American.

 

[bozack]

I just bought an AMD 1600XP, and while it is a nice chip, the only reason I bought it was because I was on a budget....if I had to to it again I would have spent the extra and gone Intel...imho a better product...

I "saved" some money two years ago by buying a Ford SVT contour, now I am kicking myself as the ride quality is next to terrible, the car feels like it will fall apart, and the paint looks like garbage.....I guess sometimes it doesn't pay to save a few bucks....I should have spent the extra on a BMW or an Audi....

So to answer your question snatch, there are two things I will not do in the future:

1. buy something just because it is cheaper than what I really want, as I always end up losing in the long run

2. Buy what I consider an "inferior" product just in the name of "supporting the underdog"

I will buy what is best for me and what I am happy with....while I think AMD is nice, I also think unless they improve their product then they are not for me, the XP I have is a great budget chip, but not something I would have bought if I was not on a budget.

 

[smadavid]

I don't get your argument...

First you say its a good, competitive thing for AMD to force intel to lower its prices, but then when intel goes ahead and does it, you say Intel's being anti-competitive. Which is it? Why is it wrong for Intel to undercut AMD's prices when AMD undercuts their prices? Is see nothing unethical.

 

[Nessal]

Originally posted by: smadavid
I don't get your argument...

First you say its a good, competitive thing for AMD to force intel to lower its prices, but then when intel goes ahead and does it, you say Intel's being anti-competitive. Which is it? Why is it wrong for Intel to undercut AMD's prices when AMD undercuts their prices? Is see nothing unethical.

If anything at all, it benefits us, the consumer.

 

[Jhhnn]

Nah, not that reason at all. It's just that it's tough to maintain a price war and solid profits at the same time. Don't get me wrong, I'm not accusing Intel of anything along the lines of some of the recent scandals, not at all. Modern, legal accounting practices allow for somewhat differing interpretations of the raw numbers, that's all, particularly with an outfit as big and diverse as Intel. Those same methods can be used to push the view to the other side when you're making money hand over fist, and want to keep some of it within the organization for whatever reasons. Happens all the time, there's really nothing wrong with it so long as the business remains on a sound footing, and the stock price reflects the true value of the operation.

It seems clear to me, however, that Intel definitely needs competition to remain honest, and that the Via C3 isn't it. When they were undisputed King a few years back, their misadventure in the Rambus deal cost them dearly, made Via a force in the market, created the opening for AMD to gain market share. Had it gone the other way, we'd all have been cornered into higher priced technology we neither needed or wanted while the Principals made a killing. I think it's really the reason they're playing hardball with Via to this day.

Just my pov, I'm certainly no financial analyst. Nor am I some raving AMD fanboy, I just try to look somewhere beyond the end of my nose, try to do my bit to contribute to healthy competition in the long run.

And I do enjoy Wingznut's presence here on the forum, I think his input is extremely valuable. I have no desire to offend him now or at any time, and that's the reason I've clarified my earlier remarks.

Edit- in regards to smadavid's remarks, Cutting prices becomes unfair when you use superior financial reserves and below cost pricing to force the competition out of the market. It remains to be seen if Intel is engaging in that kind of practice.

 

[BFG10K]

What has happened since then? Lower manufacturing costs?

Yes. Decreased die sizes and improved manufacturing techniques increase yields which makes CPUs cheaper.

Decreased demand?

I'd say if anything demand has increased. And again this'll usually lower prices as the market will become flooded with more goods.

And yet I hear members here saying that they buy whatever gives them the best performance at the best price.

That's right. I pay my hard-earned money to the manufacturer who sells what I consider the best product. I do not fork over money just to keep a company afloat. My time and money is too valuable for that kind of thing.

Well I, for one, will spend a few extra dollars to fight unethical practices and help to ensure a future where competition is possible in the CPU market.

So do you buy Cyrix processors? If not, then why not? After all, they're a potential competitor in the CPU market.

 

[Spicedaddy]

That's right. I pay my hard-earned money to the manufacturer who sells what I consider the best product. I do not fork over money just to keep a company afloat. My time and money is too valuable for that kind of thing.

Amen

 

[kgraeme]

Enthusiasts buy what makes them enthusiastic. Poor performance doesn't generally make someone terribly excited. Good performance does. For the longest time, Intel had the performance and people were willing to pay for it. Then AMD released the Athlon and things changed. Simple as that.

Enthusiasts don't determine the market though. Mass market OEM does. So really, there is no reason for you to worry about buying Intel. Your purchase isn't the deciding factor in AMD financials.

So there you go. You know you want to do it. You want to buy that P4 2.53GHz for $238 as opposed to that wussy 2.1GHz Athlon for $314.

 

[The Sauce]

Ok, addressing multiple replies here...man some of this stuff is just preposterous.

First you say its a good, competitive thing for AMD to force intel to lower its prices, but then when intel goes ahead and does it, you say Intel's being anti-competitive.

Yes, it is good that there are two companies and that they are competing. Yes, it is also bad that Intel is intentionally losing money undercutting AMD in a blatant attempt to drive them out of business. The benefit is only temporary and once AMD is gone you'll be paying $600 again for your average-performance processor from Intel. Most here do not seem to realize that.

I will buy what is best for me and what I am happy with....while I think AMD is nice, I also think unless they improve their product then they are not for me, the XP I have is a great budget chip, but not something I would have bought if I was not on a budget.

Justify your comment that AMD is an inferior product. I presently have three AMD systems and one Intel system and they are all equally stable. That XP1600+ is performance equivalent to a P4-2.0Ghz chip which costs 3-4 times as much (at least).

I'd say if anything demand has increased. And again this'll usually lower prices as the market will become flooded with more goods.

Oh my, how utterly wrong can a person be??? WE should just disregard the rest of his arguments on the basis of this statement alone. Go take any standard Micro/Macroeconomics course my friend. Increased demand invariably results in increased prices...its the opposite of companies competing - its buyers competing for the same product. Now if supply is equally high then prices may not increase that much, but this is usually not the case.

Yes. Decreased die sizes and improved manufacturing techniques increase yields which makes CPUs cheaper.

Wrong again. The cost of manufacturing new technology and building the fabs and machinery involved only gets more expensive over time, not less.

That's right. I pay my hard-earned money to the manufacturer who sells what I consider the best product. I do not fork over money just to keep a company afloat. My time and money is too valuable for that kind of thing.

With comments like this it is clear that you will be the first one to cry when your "hard-earned money" is being shelled out hand over fist for a low-end Intel cpu once they have no more competition and start price-gouging again. How far would your "hard-earned money" go today if AMD was not around and your P4-2.0GHz proc was selling for $600?

Enthusiasts don't determine the market though. Mass market OEM does. So really, there is no reason for you to worry about buying Intel.

This is true but its the principle of the thing. As hardware enthusiases a lot of people come to us for advise. I try to recommend AMD as much as possible these days.

 

[kgraeme]

Woohoo! I win! I didn't get flamed for my comments.

Seriously though, I personally like both. I built an Intel system for my own latest system and I build AthlonXP/nForce systems for others for the price/performance benefit.

 

[BFG10K]

Increased demand invariably results in increased prices

Not necessarily. Prices only increase if the amount of goods being made does not keep up with the increased demand of those goods. If your demand doubles (for example) but the amount of goods on the market quadruples then prices are sure as hell not going to increase, they'll decrease because of the market getting saturated, excess stock levels, etc.

Now if supply is equally high then prices may not increase that much, but this is usually not the case

Bingo, and the amount of CPUs being made every year is only increassing, not decreasing.

BTW, nice backpedal - first you try to ridicule my argument and then you state the above comment which essentially shows you agree with me.

The cost of manufacturing new technology and building the fabs and machinery involved only gets more expensive over time, not less.

But the cost to make each CPU gets less and less when you start to approach optimal yields. The point is that your comments about "Intel's evil price cutting conspiracy" are extremely simplistic and are a sad attempt to mask most of the real issues at hand.

With comments like this it is clear that you will be the first one to cry when your "hard-earned money" is being shelled out hand over fist for a low-end Intel cpu once they have no more competition and start price-gouging again.

As opposed to you voluntarily getting price gouged right now from AMD in the hopes that you'll fill up some manager's pockets enough so that the company will stay afloat? A manager that quite frankly probably doesn't give a dick about you?

No thanks. I'll cross the Intel price-gouging bridge if I come to it. Intel's manager may not care about me either but at least I'm getting what I consider the best product for my money.

If you like AMD's product for whatever reason then fine, go right ahead and buy it (and I certainly agree, the chips are great performers at great prices). But purchasing it simply on the grounds that Intel is evil (or words to that effect) is simply brainlesss.

 

[HendrixFan]

There is a difference between not buying Intel because they are evil, or as the original poster commented, by buying Intel you are pushing the market back into a state where Intel has complete control over pricing. Given Intel's past, its clear what they would do in such a circumstance.

That doesnt mean you have to go for a poorer product, nor does it mean you have to love the other company, in this case, AMD. If AMD had 90% control of the market, they would likely do the same pricing scheme.

I think I agree with the original post. By supporting AMD, I am doing my part to ensure a competitive marketplace. AMD is down now, and the last thing we need is for them to fall all the way. By doing my part to encourage competition, I can feel like I did the right thing for me.

Now that doesnt necessarily mean you didnt do the right thing for yourself by buying an Intel chip. We all have different things that put us at ease.

 

[dexvx]

This is obviously flame war bait, and I dont think anyone shold have the dignity to reply to it.

Processor prices have gone done because supply and demand has increased. 20 years ago, it was obscure for anyone to own a single computer. Now many people own multiple computers. Of course prices have gone down because instead of being a novelty, its becoming something that everyone owns. Fabs are very expensive to build, but once they are built, the cost per processor is much cheaper. At .09 micron process, you can also fit more cores on a single wafer, and wafers are bigger, up from 200mm to 300mm. The more processors you make and sell, the cheaper per unit. You need to take basic Econ 101.

 

[The Sauce]

The point is that your comments about "Intel's evil price cutting conspiracy" are extremely simplistic and are a sad attempt to mask most of the real issues at hand.

Please, educate us all. What are the real issues at hand?

BTW, I agree with your response to the supply/demand thing. You have to admit that your initial comment was completely off.

But the cost to make each CPU gets less and less when you start to approach optimal yields.

Yah, how late in the development cycle does that usually happen? Usually the next fab is being built by the time the previous one starts to achieve optimal yields.

But purchasing it simply on the grounds that Intel is evil (or words to that effect) is simply brainlesss.

Intel is not evil. If I were Intel I would do the same thing. Intel should take advantage of their situation an every way allowable. Yet it is in our (the consumer's) greatest interest to prevent them from doing so and subsequently fixing prices.

Now that doesnt necessarily mean you didnt do the right thing for yourself by buying an Intel chip.

Doing the right thing for yourself now does not necessarily equate to doing the right thing for yourself overall. The "right thing" for me in college was going out and getting $hit-faced every weekend...but in the long run this caused significant problems. It is exactly this short-sightedness that I am attempting to confront here.

Processor prices have gone done because supply and demand has increased.

And I need to take Econ101??? Refer to BFG's last post...he sums it up quite well.

 

[The Sauce]

BTW, this thread was not indended as flame-bait. I genuinely feel this way. I am simply trying to encourage people to recognize the issues behind the scenes as they snatch up their cheap procs.

When you go to buy your fiancee-to-be a diamond and find that anything reasonable costs > $5000, and yet diamonds are a fairly common gemstone, you will begin to understand the inevitable end-result of anticompetitive practices like this. DeBeers is similar to Intel in that regard. They have intentionally sunk every competitor by undercutting them throughout history...and now they own the entire market and rip everyone off. That is sort of what it was like before AMD started having success in the CPU market.

 

[AndyHui]

You would help AMD a lot more by buying a 2400+ which AMD can make a profit from, rather than a bargain basement 1600+ for which AMD is making a loss.

 

[BornStar]

I just recently built my first computer and I decided to go with an Athlon. To be honest, the though of helping the struggling company never really entered my head. I really liked AMD from an upgrade standpoint. What you have to realize is, I just came off a Dell with absolutely no room for upgrading. The thing I noticed with AMDs is they stayed with Socket-A whereas Intel changed their CPU interface with each generation. That means that if I wanted to do a minor upgrade down the road with an Intel CPU, I'd have to change the MB as well. I realize of course that AMD will release a new interface with the Hammer but a Barton should still fit. It's little things like this that made me pick AMD. I also decided that I prefer what AMD is doing to a point. I like the fact that they're able to achieve greater speeds for the most part from an equal chip (in terms of MHz). In my mind Intel decided they would never let AMD beat them to such a major milestone such as 1GHz again so they just boosted the clock speed with no real tangible benefits with respect to performance which just ends up cheating the customer because the average person has no idea what that stuff means. I will readily acknowledge the fact that Intel has the highest performing solution on the market at this point however it comes at a major premium. Not only do their processors cost more but their MBs that you have to pair them with do as well. If I were to go out and buy a price-no-object computer right now, I would end up with a 2.8 or 3.06GHz P4. Being more realistic, since I can't buy the computer of my dreams, I have chosen an Athlon. This is just the opinion of one of the least experienced members with respect to hardware.

 

[Boris691]

When I was deciding how to build my computer the first thing I was going to get was an AMD processor. I had read on the net that AMD was better then Intel now. After hours of research I decided against it. I could get an AMD 2200 for $314 or I could get a P4 2.4 for $339. So I thought it could be worth it to get the AMD considering that the performance loss would not be that big. Then I discovered that the AMD processor did not come with a fan or heat sink. And to get one that would support it I had to spend another 40-60 dollars. Then meant that I would get less performance for more money. Then I found out that p4 with 533 bus would be upgradeable to 3.6 gigahertz. Where as the Atholon would only go up to 2600 before I would have to get a new motherboard. What this all ads up to is I go with what?s best for me. If you feel that getting ripped off is going to save the world the go ahead and buy bad products. However if AMD can?t keep up with Intel (I however believe the will in the long run) then they don?t deserve my money. but thats just me

 

[Wingznut]

Originally posted by: Snatchface

I've never really understood "loyalty" to any corporation. Do you feel the same way about Crest/Colgate, Tide/Cheer, Band-Aid/Curad, etc?

Dude, you didn't read anything I wrote, did you. There is more to a post than the header...usually.

Yeah, I read your whole post (and the rest of them in this thread...) I just chose not to quote the entire thing because it wasn't necessary.

At any rate... It's very true that competition helps to lower prices. But the market conditions have more of an impact. If both AMD and Intel could sell the number of cpu's they did a few years ago for $1000+ each, they'd still be doing it. Things were never more competitive than the race to 1ghz. And as Accord99 pointed out, they were both selling cpu's in the $1300 range.

Originally posted by: Jhhnn
And I do enjoy Wingznut's presence here on the forum, I think his input is extremely valuable. I have no desire to offend him now or at any time, and that's the reason I've clarified my earlier remarks.

Nah, you didn't offend me. I was just curious as to why you would have that perception. Obviously, I don't feel the same way.

Originally posted by: BFG10K

What has happened since then? Lower manufacturing costs?

Yes. Decreased die sizes and improved manufacturing techniques increase yields which makes CPUs cheaper.

Those and many, many other factors lead to lowering the cost of each finished wafer. And don't think that lowering costs isn't an important (or easy) priority.

 

[bozack]

Justify your comment that AMD is an inferior product. I presently have three AMD systems and one Intel system and they are all equally stable. That XP1600+ is performance equivalent to a P4-2.0Ghz chip which costs 3-4 times as much (at least).

I was basically saying that if I had to do it again, I would have spent a little extra money on an Intel based system than an AMD...the only reason I went with the XP 1600 was because I thought I could re-use my pc133 memory but it turned out that was not the case, had In known I would have had to also upgrade my memory at the time I would have just bought Intel.

Also, I think upon visual inspection the AMD chip just looked like it was made "cheaper", it runs hotter than any Intel chip I have dealt with, and the retail heatsink/fan that came with the chip isn't that great IMHO.

That is "my opinion" as an owner though...and I am entitled to my opinion.

Unless something radical happends to put AMD in the performance lead then my next system will most likely be Intel.