DigiTimes: AMD should not overly rely on game consoles

[Sweepr]

Although AMD CEO Rory Read is optimistic about the company's financial results in the third quarter and expects to turn profitable, the strategy of relying only on orders from the game console sector is still rather risky at a time like this.

Ever since AMD acquired ATI, the company has seen losses, sold its wafer foundry business and undergone business reorganization. For a company like AMD, which relies heavily on PC processor and graphics card sales, the weakening PC demand is posing a big challenge, and sending it looking elsewhere for profits.

Although AMD has indeed achieved great results in the game console market, landing processor orders for both Microsoft's Xbox One and Sony's Playstation 4, the game console industry, like the PC market, is also experiencing serious impacts from mobile devices. When it is still uncertainty whether game consoles will see as much demand as they did in the past, AMD seems to be over-optimistic about the third quarter.

Currently, AMD's PC processor and graphics card businesses have seen their market shares drop, especially in the major battlefield: China. When Karen Guo was still head of AMD China, the company had strong showing in China. But after her departure, AMD's shares dropped quickly to only about 20% for both businesses.

Its competitors, Intel and Nvidia, are expected to continue expanding their shares in the PC and graphics card markets. If AMD ends up losing its PC platform battle, not even strong game consoles orders will be able to offset the loss.

The income from the game console sector may help AMD in the short term. But the long-term solution still lies in its ability to turn the tables in the PC and mobile device markets.

www.digitimes.com/news/a20130723PD207.html

 

[ShintaiDK]

What does Digitimes expect? Turn the tables in PC and mobile space? Oh lord. Thats exactly why they need to try different segments. They are chanceless in those.

 

[Sweepr]

What does Digitimes expect? Turn the tables in PC and mobile space? Oh lord. Thats exactly why they need to try different segments. They are chanceless in those.

Months after Temash/Kabini launch I still cant find the thin and light 10-12'' 1080p notebooks with great battery life and performance for cheap prices many (including me) were expecting. With 0-18% better normalized battery life than last years IB ULV and much worse CPU/GPU performance I certainly woundt expect OEMs to be very excited about it in 2013 (especially now that we have Haswell ULT destroying IB ULV's battery life numbers) unless its very cheap.

 

[SiliconWars]

Months after Temash/Kabini launch I still cant find the thin and light 10-12'' 1080p notebooks with great battery life and performance for cheap prices many (including me) were expecting. With 0-18% better normalized battery life than last years IB ULV and much worse CPU/GPU performance I certainly woundt expect OEMs to be very excited about it in 2013 (especially now that we have Haswell ULT destroying IB ULV's battery life numbers) unless its very cheap.

Last quarters 12% increase in CPU revenues says you're completely wrong. Did you even read the conference call? Can you find me an IVB or Haswell ULV at near the cost?

Awful article btw, are we now linking every bit of "analysis" from random writers? Of course AMD shouldn't be over-reliant on consoles. They aren't, in fact they've been quite upfront about the fact that it'll only be 20% of their revenues by the end of the year. That's quite a long way away from over-reliance.

 

[monstercameron]

Months after Temash/Kabini launch I still cant find the thin and light 10-12'' 1080p notebooks with great battery life and performance for cheap prices many (including me) were expecting. With 0-18% better normalized battery life than last years IB ULV and much worse CPU/GPU performance I certainly woundt expect OEMs to be very excited about it in 2013 (especially now that we have Haswell ULT destroying IB ULV's battery life numbers) unless its very cheap.

not to go off topic but you are comparing less than $100 chip to a greater than $200 chip. Also there was only ever 1 ultrabook chasis notebook I have ever seen amd in. That was the asus vivobook u38n.
AMD definitely can work well in those environments but it seems oems have other incentives elsewhere.

 

[Sweepr]

not to go off topic but you are comparing less than $100 chip to a greater than $200 chip. Also there was only ever 1 ultrabook chasis notebook I have ever seen amd in. That was the asus vivobook u38n.
AMD definitely can work well in those environments but it seems oems have other incentives elsewhere.

U38N is certainly interesting but it is based on Trinity hardware, Temash should deliver somewhat similar performance but better battery life. Is there anything similar to the U38N (but cheaper) with Temash? Sometimes much cheaper AMD CPUs are packed inside similarly priced notebooks with faster CPUs from the competition but thats not AMDs fault I guess.

 

[monstercameron]

U38N is certainly interesting but it is based on Trinity hardware, Temash should deliver somewhat similar performance but better battery life. Is there anything similar to the U38N (but cheaper) with Temash? Sometimes much cheaper AMD CPUs are packed inside similarly priced notebooks with faster CPUs from the competition but thats not AMDs fault I guess.

right now they are doing it like they always do[which is underwhelm] the best platforms with temash are acer v5-122p 11.6" with 1366*768 ips screen or the samsung series 9 lite[with a crappy 13*7 screen]. I have seen kabini in 17.3" screen craptops. We might never see another slim, premium amd notebook for a long while.

 

[VirtualLarry]

right now they are doing it like they always do[which is underwhelm] the best platforms with temash are acer v5-122p 11.6" with 1366*768 ips screen or the samsung series 9 lite[with a crappy 13*7 screen]. I have seen kabini in 17.3" screen craptops. We might never see another slim, premium amd notebook for a long while.

Speaking of that Acer, they have it at Amazon.com.

3-cell Li-ion Battery

"You can extend battery life up to 6 hours with an optional second battery and accomplish all your daily tasks from day to night without having to think about recharging."

Are they f'ing joking? Cut the factory battery cell count in half, and then have the nerve to suggest buying a second battery to carry around with you, in order to have a full battery life, should they have put in a full-size battery.

I'm using a c-60 (1.0Ghz, with 1.33 turbo) dual-core Acer Aspire One, and it has a 6-cell battery, which lasts for 5 hours.)

 

[wlee15]

Speaking of that Acer, they have it at Amazon.com.

3-cell Li-ion Battery

"You can extend battery life up to 6 hours with an optional second battery and accomplish all your daily tasks from day to night without having to think about recharging."

Are they f'ing joking? Cut the factory battery cell count in half, and then have the nerve to suggest buying a second battery to carry around with you, in order to have a full battery life, should they have put in a full-size battery.

I'm using a c-60 (1.0Ghz, with 1.33 turbo) dual-core Acer Aspire One, and it has a 6-cell battery, which lasts for 5 hours.)

What I understand is that it has slot where you can add a second battery while the 3-cell is internal and cannot be removed.

 

[cytg111]

I think news like this is a positive thing, to me it says AMD is still in the game, keep it up, dont let your guard down.

 

[Idontcare]

AMD definitely can work well in those environments but it seems oems have other incentives elsewhere.

You can easily convince yourself that a paranoid cynical view must be the reality, but that doesn't actually make it the reality.

For example the same kind of argumentation you post above could be implied towards AMD keeping Via out of the same form factors.

"And why isn't the Via Nano totally owning the same space that AMD is trying to get their 'cat line into? Me thinks those oems must have other incentives elsewhere :hmm:"

This is the kind of stuff that just leads you to seeing boogeymen in every shadow, thieves on every corner, and a pick-pocketer in every neighbor. But that doesn't mean any of it is true.

If an OEM doesn't feel it is worth the investment on their part to develop an entire product around an AMD cpu there is a real chance that it is because the OEM doesn't see the ROI from that product as being superior to the ROI they might get from making the same investment into developing an alternative product line.

Same reason we don't see a market flooded with low-power Via processors, or high-power Power7+ desktops, etc.

Why did MS drop Itanium support in windows? Do you think they had "other incentives elsewhere" or do you think it was motivated by a business desire to maximize their returns on investments and decided to invest their resources smartly?

 

[strata8]

Speaking of that Acer, they have it at Amazon.com.

3-cell Li-ion Battery

"You can extend battery life up to 6 hours with an optional second battery and accomplish all your daily tasks from day to night without having to think about recharging."

Are they f'ing joking? Cut the factory battery cell count in half, and then have the nerve to suggest buying a second battery to carry around with you, in order to have a full battery life, should they have put in a full-size battery.

I'm using a c-60 (1.0Ghz, with 1.33 turbo) dual-core Acer Aspire One, and it has a 6-cell battery, which lasts for 5 hours.)

The Acer seems to be a dud. They claim 3.5 hours using MobileMark 2007, but Samsung - using the same processor, battery size, and benchmark - claims 8.5 hours. So I don't know what's up with that.

 

[pablo87]

Microsoft and Intel have been milking the cow to death instead of feeding it, its finally killing the PC industry as we knew it.

All the tactical revenue maximizing, customer cajoling, competition bullying and spinmeistering in the world while it works great short term, kills the business long-term because while the organizations aren't focused on innovation and value, disrupting alternatives like Smartphones,Tablets and Consoles pass them by.

In a sense, AMD is being victimized twice (plus they're very good at shooting themselves in the foot). First, they get "crowded out" of design wins. Second, the market is shrinking. Neither of which they have control over. So they're doing the right thing to leave the sinking ship because if they don't, they'll be devoured by the musicians. Better to be a big fish in a small pond than to be collateral damage.

Digitimes knows this. Full well. So why the article you ask? Profitable pandering. Intel is the big dog in Taiwan. Digitimes is using AMD's Console wins to justify why AMD is about to lose some major market share to Intel (and perhaps to NVIDIA) - its AMD's fault you see, they're not paying attention to their traditional business. Or so they want us to believe.

The sad reality is, Intel is probably buying the business. Understandably so - Intel has massive overhead, they cannot afford to ship fewer units because a lot of their COGS structure is fixed, not variable (based on the formuula overhead/units shipped). And besides, the upside of having a lot of overhead is your marginal cost is very low - I wouldn't be surprised if it was still "profitable" in a variable contribution-variable cost sense for Intel to sell the cheap processors for as little as $15.

And even if ATIC financially supported AMD in its meetcomp efforts, they'd still fail - its the structural benefit of being the dominant player (aka leveraging the panderers) in a vendor/customer industry.

Bottom line, the business is there for Intel to take and Intel is taking it. Digitimes is just the spinmeister.




PS - anybody remember the "Tired of not having a Choice? Cyrix Instead" marketing campaign where Cyrix knocked off the Intel Inside logo? Well, it finally happened:

"Tired of not having a Choice? Smartphone, Tablet, Console Instead"

 

[monstercameron]

You can easily convince yourself that a paranoid cynical view must be the reality, but that doesn't actually make it the reality.

For example the same kind of argumentation you post above could be implied towards AMD keeping Via out of the same form factors.

"And why isn't the Via Nano totally owning the same space that AMD is trying to get their 'cat line into? Me thinks those oems must have other incentives elsewhere :hmm:"

This is the kind of stuff that just leads you to seeing boogeymen in every shadow, thieves on every corner, and a pick-pocketer in every neighbor. But that doesn't mean any of it is true.

If an OEM doesn't feel it is worth the investment on their part to develop an entire product around an AMD cpu there is a real chance that it is because the OEM doesn't see the ROI from that product as being superior to the ROI they might get from making the same investment into developing an alternative product line.

Same reason we don't see a market flooded with low-power Via processors, or high-power Power7+ desktops, etc.

Why did MS drop Itanium support in windows? Do you think they had "other incentives elsewhere" or do you think it was motivated by a business desire to maximize their returns on investments and decided to invest their resources smartly?

i dont know if i would call my post paranoid because "incentives elsewhere" has a pretty wide range of possibilities. The facts[as I see them(opinions then?)] are that oems would rather spend more than 2x the cost of the amd parts[think intel i5 and discrete gpu] and lower their margins that design a good notebook based on amd parts, especially in the thin/slim/light category.

This can be seen even recently, samsung series 9 and the lite version, the intel part has a freaking 3200*1800 display in an uber thin chassis while the light has a 13*7 mediocre panel with a thicker/heavier chassis and the worst part is that the series 9 lite will probably be the highest profile design win for...temash. They even used the wrong part in the product when it should have been kabini.

I dont know about this roi issue you speak of because amd is buy cheap, sell cheap. Also via and power7 are really bad examples...

 

[monstercameron]

The Acer seems to be a dud. They claim 3.5 hours using MobileMark 2007, but Samsung - using the same processor, battery size, and benchmark - claims 8.5 hours. So I don't know what's up with that.

also the samsung part scores better in geekbench...