DEll gets closer to AMD

[slashzero]

Obviously you guys don?t understand fully the deal Intel has in place with Dell.
Dell does not buy processors from Intel like other large OEMS. Intel gives Dell what they want and only charge Dell for what they sell. Basically they give Dell inventory and Dell only has to pay for what they sell and only for what the CPU/case/mobo is worth at time of sale!!!, not to mention Dell gets first dibs. This is the reason Dell has remained the cheapest OEM and the number one OEM in terms of market share.
The deal that Intel has in place with Dell is only valid as long as Dell stays Intel only and if they don?t then Dell prices would go up and they wouldn?t make much per system as they do now. All those systems you see with huge rebates with older 2.6?s and what not cost Dell next to nothing to make even though the board and chips have been in the inventory since they were top of the line Dell only has to pay day of sale prices where as other OEM pay full upfront regardless of when they sell or if they do at all.
Also all advertisements that Dell runs are paid for by Intel by 75% which again saves dell hundreds of millions.

What you must understand, Dell is not only getting the cpus first but they pay much less then any other OEM and this is the reason dell has managed to pull in such great profits.
I would estimate that if Dell lost this deal with Intel and gained 5-10% more server market share with AMD they would still lose millions.

This is about $$ guys it doesn?t matter if an opteron system is 5-10% faster that isn?t enough to convince any OEM to drop the Intel name. Think of Dell, Microsoft, and Intel as the same corporation. The only time one will step out of line is when they are looking for a better deal.

 

[Shenkoa]

Hmm, and how does Dell make this money???

Off Ignorant people who know nothing about technology!!!! buying the crap out of the computer that looks the best.

Many people in my family have all bougt PC's in the last 5 years. Every time, I tell them to take me with em and no one did.

Now?? They all have Celeron's with 128 MB of RAM!!!!!! AND THEY ARE ALL VERY PRETTY!

 

[mechBgon]

Originally posted by: Shenkoa

but costomers simply are not asking for amd

Thats because consumers are stupid, all they have ever known or seen is the blue people. But Intel works for em, we do not want AMD becomming as big as Intel because I am worryed that at that point AMD could become as money hungery as Intel is and release 31 Stage 4 GHZ POS's

Caution: do not enter the AnandTech Forums without your sarcasm detector

 

[Zebo]

Originally posted by: Shenkoa
Hmm, and how does Dell make this money???

Off Ignorant people who know nothing about technology!!!! buying the crap out of the computer that looks the best.

Many people in my family have all bougt PC's in the last 5 years. Every time, I tell them to take me with em and no one did.

Now?? They all have Celeron's with 128 MB of RAM!!!!!! AND THEY ARE ALL VERY PRETTY!

No one in my family knows I even know about computers and I intend to keep it that way. Keep this in mind when they call for support.


slashzero...good thoughts interesting...

 

[clarkey01]

Intel is dells b*tch. They are trying to get a better deal from them by saying " we'll go AMD".

 

[gobucks]

What will likely happen is that Dell may offer some server and its "XPS" systems with AMD, so as not to conflict too heavily with Intel. These are pretty small markets, and as long as Dell does not let AMD cut into their bread and butter midrange/lowend business, I doubt Intel will be able to argue too much. Basically with the situation right now, Dell is the "giver" and Intel is the "reciever." If Dell says "5% of our systems will be AMD, but they are all gonna be in the enthusiast and server segment, and you're gonna like it," then Intel is not in much of a position to argue. They know they are beaten at the extreme high end and in the server segment, and will remain that way for a while. However, they also know that they have the mindshare of the average Joe, and that they could sell a processor that was basically a single transistor running at 10GHz if they marketed it right. "Wow, a new 10GHz Pentium 5 ultra hyper-duper-threading with SSE4 and turbo-loading. Wow!!!!!" They know AMD won't have the capacity to replace Intel on the desktop at Dell until 2006, so they can call Dell's bluff if some of Dell's Dimension desktops start showing up with A64 and Semprons inside. That's the way I see it playing out, but anything could happen. After 2006, the stage will be very different, as AMD will actually be able to offer Dell what Intel offers it, but that is a battle for another day.

 

[Keysplayr]

Originally posted by: carlosd

Originally posted by: Schadenfroh
but customers simply are not asking for amd

Yes, iliterate people is not asking for the best CPU's in the market, they are asking what they see in TV!

That would be, "Illiterate people are".

 

[Zebo]

Originally posted by: gobucks
What will likely happen is that Dell may offer some server and its "XPS" systems with AMD, so as not to conflict too heavily with Intel. These are pretty small markets, and as long as Dell does not let AMD cut into their bread and butter midrange/lowend business, I doubt Intel will be able to argue too much. Basically with the situation right now, Dell is the "giver" and Intel is the "reciever." If Dell says "5% of our systems will be AMD, but they are all gonna be in the enthusiast and server segment, and you're gonna like it," then Intel is not in much of a position to argue. They know they are beaten at the extreme high end and in the server segment, and will remain that way for a while. However, they also know that they have the mindshare of the average Joe, and that they could sell a processor that was basically a single transistor running at 10GHz if they marketed it right. "Wow, a new 10GHz Pentium 5 ultra hyper-duper-threading with SSE4 and turbo-loading. Wow!!!!!" They know AMD won't have the capacity to replace Intel on the desktop at Dell until 2006, so they can call Dell's bluff if some of Dell's Dimension desktops start showing up with A64 and Semprons inside. That's the way I see it playing out, but anything could happen. After 2006, the stage will be very different, as AMD will actually be able to offer Dell what Intel offers it, but that is a battle for another day.

False premise IMO. You ast as if the lead is substantial when in fact it's minimal and easily erased by Intels brand awardness, and a insignifigant time period which Intel will come back to lead again. It's questionable if Dell would even make a profit gearing up for a small AMD segment they may offer compared to the hard feeling$ of dissing Intel which could last years. I would'nt switch based on how cheap they sell intel systems for. It's quite obvious they pay less than half for each chip as someone like newegg by thier $250-450 servers they pimp on a regualar basis.

 

[slashzero]

Sorry but unless AMD is willing to hand over hundreds of millions to Dell for its advertising I can't see Dell going AMD. Not to mention the millions of dollars it would take for Dell to add support for AMD servers and chipsets.

Simple Question

1. Apease AMD zealots and lose all profitability from desktops, lose unified support costs, lose millions from marketing(Intel pays for all dell commercials), lose the special inventory system agreement thats in place.

2. Keep on being Intel only and being the #1 OEM get all your marketing paid for by Intel and only pay Intel for products when they sell and not upfront.

Hrmmm thats just such a hard question for a business who want to make $$$ to anser.

In a move to reduce expenses, Gateway will soon no longer sell PCs with AMD processors. Gateway will go back to an Intel-only model, similar to Dell's strategy.

Hrmm now think about Dell and the even better deal it has with Intel. lol...

 

[dmcowen674]

Originally posted by: Zebo
Translation: Dell Looking for a better CPU deal from Intel.

No way you'll see AMD chips at Dell. I will stop posting for two months if it comes to pass.

I just saw these articles over morning and bagel and nearly choked to death (I know many would like to hear that news )

I thought I saw a post somewhere that Micheal Dell said he would be put in his grave before he ever allowed an AMD chip in his machines???

 

[ssvegeta1010]

As all of you should know, if you are an enthusiast, then don't buy a Dell.

But for pre-builts and value systems Dell is the best. As to the "Celerons with 128 MB of RAM" comment, sure the value systems are crap, but they sell them for reasonable prices. (ie. Desktops currently start at $350)

In relation to AMD, they will adopt it for the servers and XPS system, but currently it will take a long time to adopt

 

[Zap]

Originally posted by: ZeboNo one in my family knows I even know about computers and I intend to keep it that way. Keep this in mind when they call for support.

Too late for me. I don't even tell people, but my mom thinks she is doing me a favor by telling everyone her son is a computer expert. She seems to think it will increase/improve my business. All it does is make people think "oh, someone that can give me free tech support because I know his mother."

A while back a page on Dell's site was exposed showing Opterons for sale. Dell's official word was that a large customer requested it. (BTW, anyone have links? I know I'm not imagining this) We can infer some stuff from this... Dell does get requests for AMD and is not fully 100% against AMD as long as they can profit from it (in this case keeping a high volume customer happy - OMG "high volume" to Dell must be HUGE). "Profit" includes not making Intel pissed off and keeping high volume customers happy, in addition to the actual profit off a sale.

This is not as guaranteed as death and taxes, but I can certainly imagine Dell computers with Opterons in place of Xeons and Itaniums (does Dell sell those?). At that end of the spectrum the volume is much lower anyways, plus the price/performance difference is much more on AMD's side.