Intel has $55.9B record year, ships 46M tablets

[elemein]

Perhaps but there was this another thread where I posted about Xiaomi, now the point was that the mobile market is a race to bottom & really the only viable competitors left at the end of this rat race will be highly integrated players like Apple, Samsung (because they always have a choice for in house design in flagship products, the ones that actually make any money in this market) & to a lesser extent Qualcomm. What I foresee with contra revenues is a bloodbath in the not so distant future, with pretty much everyone operating on wafer thin margins being wiped out in the blink of an eye.

The point is mobile sector ain't yielding any money for Intel so why'd they not wait this storm out ? It's not like their R&D wasn't yielding any results, but then again they have to chug their fabs along, the only real justification I can see in for this.

Well, SoFIA would be fully integrated, and while it's not on the scene right now, when it hits I can imagine, in my opinion that it'd basically gut all the lower end chips that any company with more than a few dollars to their name would want. SoFIA's aim isn't high performance. It isn't Apple. It's the lower end where they wouldn't make much anyway (but would likely have a sickingly large market share if they play things right which they could work up on.)

But that's just phones (which is part of mobile), as for tabs, I still see Intel being able to compete. Again, it'd need a fully integrated solution (SoFIA on steroids? Or fully integrated BT?), but after that it'd just be a question of price and performance. Intel could likely do performance, but it may need some intervention from another fab to hit the cost window.

They can probably do it, but they'd need to get in before that point (read: now, ie. they have), and then they'd need to make themselves a good solution that can compete with everyone else (they kind of have with BT, but OEM decisions are castrating it.)

 

[R0H1T]

Who is Intel driving out of the market with their strategy?
Name one company Intel has driven out of the mobile phone/tablet market with their strategy.

You mean filing for bankruptcy or driven to irrelevance, like AMD? Yes I know it wasn't entirely their fault but they were a major part of it. As for the former, none yet but let's see what 2015 brings us & whether they continue to gain marketshare literally at the expense of others.

 

[elemein]

You mean filing for bankruptcy or driven to irrelevance, like AMD? Yes I know it wasn't entirely their fault but they were a major part of it. As for the former, none yet but let's see what 2015 brings us & whether they continue to gain marketshare literally at the expense of others.

AMD was hardly in the market to begin with. Can't drive someone out of a market they're hardly in.

Even if Intel didn't step into the tab market, QCOM and Apple would kick (and are the main reason for) AMD to the curb.

Unless you mean the PC market, which is a bit different.

 

[jpiniero]

Who is Intel driving out of the market with their strategy?
Name one company Intel has driven out of the mobile phone/tablet market with their strategy.

AMD. On top of it, they are probally giving away Bay Trail-D and M, which totally destroyed the Cat cores.

 

[R0H1T]

AMD was hardly in the market to begin with. Can't drive someone out of a market they're hardly in.

Even if Intel didn't step into the tab market, QCOM and Apple would kick (and are the main reason for) AMD to the curb.

Unless you mean the PC market, which is a bit different.

I was talking about the desktop market & despite what naysayers here say about'em Intel was guilty back then as well.

 

[elemein]

I was talking about the desktop market & despite what naysayers here say about'em Intel was guilty back then as well.

Well maybe in that market, but certainly not in the tab market. I don't see any fewer major tab CPU firms than before Intel was in the market.

 

[ShintaiDK]

It really turned into a crusade didnt it? You have zero edvidence, everything against you. And you still continue.

 

[Lonyo]

You mean filing for bankruptcy or driven to irrelevance, like AMD? Yes I know it wasn't entirely their fault but they were a major part of it. As for the former, none yet but let's see what 2015 brings us & whether they continue to gain marketshare literally at the expense of others.

AMD doesn't have the resources to try and enter the mobile phone market which is indeed due to Intel's historic actions in another market, but is irrelevant to the discussion of their approach to the mobile market now.
You could say that Intel drove whoever out of the mobile market in the 90s (e.g. VIA, Cyrix) if you really want.
I was asking which parties ALREADY IN THE MARKET prior to Intel joining were driven out by their strategy.

 

[R0H1T]

It really turned into a crusade didnt it? You have zero edvidence, everything against you. And you still continue.

Like this ~

1) Market manipulation - check
2) Contra revenues - check
3) legally valid :hmm: grey area for now

The onus is on Intel to stop contra revenues & turn their mobile fortunes around, only this time without the big $, so if they do get a deserved spot in the market - kudos to them otherwise there'll be the same excuses given as being provided atm.

 

[Lonyo]

How is Intel manipulating the market?
You are assuming that pricing their product to be competitive = manipulating the market.
The market is massive with many players.
Intel simply doesn't have enough influence to manipulate the market, they are a fly buzzing around the tail of ARM.

1) Uncheck
2) Subsidies, OK
3) Subsidies have been around for decades, many legal precedents on various types of subsidies and discounts.

Android is given away for free by Google.
It costs them money to make. Therefore, Google is dumping Android, which harms Microsoft because Microsoft is being forced to give their product away for free as well. Clearly this should be illegal and Google should be punished for having a free OS subsidised by the rest of their business.

 

[GreenChile]

I was talking about the desktop market & despite what naysayers here say about'em Intel was guilty back then as well.

Wow I've never seen anyone hold so tightly to a losing battle. You've been proven wrong at every turn so far. Now you change direction again when pinned down? What does the desktop market have to do with contra revenue on tablets?

 

[R0H1T]

How is Intel manipulating the market?
You are assuming that pricing their product to be competitive = manipulating the market.
The market is massive with many players.
Intel simply doesn't have enough influence to manipulate the market, they are a fly buzzing around the tail of ARM.

1) Uncheck
2) Subsidies, OK
3) Subsidies have been around for decades, many legal precedents on various types of subsidies and discounts.

Selling 46m chips by providing an additional $1 billion (slightly more than that) is market manipulation IMO, you're OK with this but I doubt some of the small(er) chipmakers would be equally thrilled. Any amount of $ spent to achieve that end is _____ you can use your imagination to fill in the blanks, since I've stated it countless times afore this.

Wow I've never seen anyone hold so tightly to a losing battle. You've been proven wrong at every turn so far. Now you change direction again when pinned down? What does the desktop market have to do with contra revenue on tablets?

Did you see the context & the quoted post, doubt that was the case

 

[Anon_lawyer]

That's because the law, as it stands today, doesn't encompass or envison the computing industry holistically but that doesn't mean that they can't expand its scope. Intel doesn't operate in a multitude of markets, market segments, consumer segments, industry segments in isolation of each other.

I wonder how the LCD price fixing case was resolved, did the EU fine the defendants based on whether they fixed prices of LCD monitors, TV's or small screen items like a smartphone? The law, as I stated earlier doesn't take into account the semiconductor/MPU industry as a whole. What they're doing now is taking into account the components that sell in a given sector, say mobile, & not how the players operating (dominating) in multiple sector, say servers, of the (computing) industry are leveraging their clout (or money) to manipulate a certain subsection of this (computing) industry.

Once again, none of that is true. Antitrust law has been worrying about the tech industry for decades. The Microsoft antitrust case (filed in 1998) was all about leveraging a monopoly in one area (desktop operating systems) to build a monopoly in another (web browsers). AMD and Intel had lawsuits about predatory pricing not too long ago. Ultimately all this contra-revenue stuff boils down to whether a rebate plan constitutes predatory pricing. For that matter, a lot of this ground was explicitly covered by the IBM case in the 1970s too. There's nothing new about that. Some in the tech industry likes to think that when it happens in their industry its always sui generis, but that's rarely the case.

The law most certainly does not prohibit spending a lot of money to break in to a market, even if it's close to the one you already operate in. That would be crazy. It is impossible to get into any capital intensive industry without spending a lot of money. I'm sure you're not saying that starting a new semiconductor manufacturing company should be against the law, but if you couldn't spend a lot of money to start up a new business... it would be.

Price fixing is the opposite of predatory pricing. Competitors get together and all agree on prices (and usually quantities they will sell). If you Google it there's lots of information out there in the media about the conduct and the settlement.

 

[Lonyo]

Selling 46m chips by providing an additional $1 billion (slightly more than that) is market manipulation IMO, you're OK with this but I doubt some of the small(er) chipmakers would be equally thrilled. Any amount of $ spent to achieve that end is _____ you can use your imagination to fill in the blanks, since I've stated it countless times afore this.Did you see the context & the quoted post, doubt that was the case

You've decided you don't like a reasonable business practice and therefore it should be illegal. Thankfully laws aren't made that way.

If you ever set up your own business, I assume you would be one of those ethical/fair trade type business, but the semiconductor industry doesn't work like that. It takes a lot of money to break into the industry.

Also, you seem to be acting like Intel's allocation of revenue and expenses relates to anything.
It's accounting. Intel could allocate things however they want. Someone else has already discussed the variable costs of the chips. If Intel wanted, they could allocate all the R&D related to these chips to the PC group and say it was all related to PC processors, allocate all the fab R&D similarly, and remove any and all depreciation from the mobile group to significantly reduce the expenses for the group, and allocate the contra-revenue to marketing expenses.
Suddenly the losses disappear!

You are basically saying
"A COMPANY CANNOT OPERATE AT A LOSS TO ENTER A NEW MARKET SEGMENT BECAUSE THAT'S BAD".

Therefore Tesla is bad because they were lossmaking when they released their first car, which is manipulating the market, and they spent millions* to get there, for example.
Your argument is stupid, and you can't seem to understand that. Basically you are saying any entry to a new market which results in losses for the company trying to enter the market is market manipulation.
That means you believe that markets with a high barriers to entry through cost should be closed off to any new entrants.
Read a book on how business and markets work, PLEASE. Take this opportunity to educate yourself.

*Edit, did say billions, in fact it was only $200m losses up to 2009 when they did their IPO, and they are still making losses now.

 

[R0H1T]

Price fixing is the opposite of predatory pricing. Competitors get together and all agree on prices (and usually quantities they will sell). If you Google it there's lots of information out there in the media about the conduct and the settlement.

Predatory pricing itself isn't outlawed, perhaps rightly so but where do you draw the line? Intel will have a sizeable chunk of the mobile market by the end of this year, most probably with more contra revenue $, & we may see some of the smaller ARM makers sidelined like what happened with AMD nearly a decade ago. This is where the context comes in, some posters above don't see the obvious correlation, what amount of pain (for these smaller chipmakers) is enough before the govt steps in, will they repeat their mistakes of the past by letting Intel get away with it again? What's the threshold beyond which others, like most on this forum, will condemn such tactics? Is there a threshold or is it every man for himself like has been the case for as long as I remember?

Also, you seem to be acting like Intel's allocation of revenue and expenses relates to anything.
It's accounting. Intel could allocate things however they want. Someone else has already discussed the variable costs of the chips. If Intel wanted, they could allocate all the R&D related to these chips to the PC group and say it was all related to PC processors, allocate all the fab R&D similarly, and remove any and all depreciation from the mobile group to significantly reduce the expenses for the group, and allocate the contra-revenue to marketing expenses.
Suddenly the losses disappear!

Like this is happening for the first time right? What did the law do back then, when the damage was already done? It's not like there isn't a precedent here it's just that people conveniently choose to ignore it for whatever reason best suits them!

 

[Lonyo]

My point was you're basically arguing semantics.
99% of companies entering a new market with high cost of entry run at a loss for years before eventually making a profit.
You are saying Intel doing it is bad because you say it's bad. WHAT ABOUT EVERY OTHER COMPANY EVER THAT'S DONE IT?

You are complaining about Intel's presentation of what they are doing, while REFUSING to answer the question about why it's fundamentally a bad thing when IT'S A REQUIREMENT FOR ENTERING THE MARKET.
IT IS NOT POSSIBLE TO ENTER THE MOBILE TECH MARKET FROM NEAR SCRATCH WITHOUT OPERATING THAT SPECIFIC SEGMENT AT A LOSS. ALL COMPANIES WILL HAVE DONE IT. YOU ARE ONLY COMPLAINING ABOUT HOW INTEL ARE PRESENTING THAT LOSS.

WHY WILL YOU NOT STATE WHY YOU DON'T HAVE A PROBLEM WITH EVERY OTHER INSTANCE OF ANY COMPANY ENTERING A MARKET WITH A HIGH COST OF ENTRY WHERE THEY RUN AT A LOSS FOR A FEW YEARS??

Example: Nvidia with Tegra. They didn't present things as being "contra revenue", but they made losses on Tegra. Which means they weren't selling it at a high enough price to cover their costs. Therefore it was effectively subsidised. But they didn't call it contra-revenue, they had a price which was less than the related expenses being incurred, so they made a loss. Therefore NV bad. Distorting market. Evil. Lawsuit.

 

[R0H1T]

My point was you're basically arguing semantics.
99% of companies entering a new market with high cost of entry run at a loss for years before eventually making a profit.
You are saying Intel doing it is bad because you say it's bad. WHAT ABOUT EVERY OTHER COMPANY EVER THAT'S DONE IT?

You are complaining about Intel's presentation of what they are doing, while REFUSING to answer the question about why it's fundamentally a bad thing when IT'S A REQUIREMENT FOR ENTERING THE MARKET.
IT IS NOT POSSIBLE TO ENTER THE MOBILE TECH MARKET FROM NEAR SCRATCH WITHOUT OPERATING THAT SPECIFIC SEGMENT AT A LOSS. ALL COMPANIES WILL HAVE DONE IT. YOU ARE ONLY COMPLAINING ABOUT HOW INTEL ARE PRESENTING THAT LOSS.

WHY WILL YOU NOT STATE WHY YOU DON'T HAVE A PROBLEM WITH EVERY OTHER INSTANCE OF ANY COMPANY ENTERING A MARKET WITH A HIGH COST OF ENTRY WHERE THEY RUN AT A LOSS FOR A FEW YEARS??

That's because they're mostly trying to recoup their R&D costs & reduce production costs at the same time, a hard mix. Is this what;s happening here?

I asked previously that will Intel stop contra revenues in 2015, the answer I got was probably not. So tell me spending billions on R&D, probably a similar amount in buying a sizeable chunk of their current marketshare, what they're basically doing are putting devices out their for sale which otherwise wouldn't sell if it weren't for their cheap $ tag.

Is that sustainable - sure it is for Intel, will that drive other businesses on the verge of obsolescence - most likely, bankruptcy - time will tell.

So now you tell me when do you call a spade a spade?

 

[TreVader]

My point was you're basically arguing semantics.
99% of companies entering a new market with high cost of entry run at a loss for years before eventually making a profit.
You are saying Intel doing it is bad because you say it's bad. WHAT ABOUT EVERY OTHER COMPANY EVER THAT'S DONE IT?

You are complaining about Intel's presentation of what they are doing, while REFUSING to answer the question about why it's fundamentally a bad thing when IT'S A REQUIREMENT FOR ENTERING THE MARKET.
IT IS NOT POSSIBLE TO ENTER THE MOBILE TECH MARKET FROM NEAR SCRATCH WITHOUT OPERATING THAT SPECIFIC SEGMENT AT A LOSS. ALL COMPANIES WILL HAVE DONE IT. YOU ARE ONLY COMPLAINING ABOUT HOW INTEL ARE PRESENTING THAT LOSS.

WHY WILL YOU NOT STATE WHY YOU DON'T HAVE A PROBLEM WITH EVERY OTHER INSTANCE OF ANY COMPANY ENTERING A MARKET WITH A HIGH COST OF ENTRY WHERE THEY RUN AT A LOSS FOR A FEW YEARS??

Example: Nvidia with Tegra. They didn't present things as being "contra revenue", but they made losses on Tegra. Which means they weren't selling it at a high enough price to cover their costs. Therefore it was effectively subsidised. But they didn't call it contra-revenue, they had a price which was less than the related expenses being incurred, so they made a loss. Therefore NV bad. Distorting market. Evil. Lawsuit.

Could you give us an example of a company operating at a loss of > $1B per quarter for 12+ consecutive quarters? In an emerging product segment?


I can't think of one. Single. One.


Also, Tegra is your example of success? Lol.

 

[Anon_lawyer]

Predatory pricing itself isn't outlawed, perhaps rightly so but where do you draw the line? Intel will have a sizeable chunk of the mobile market by the end of this year, most probably with more contra revenue $, & we may see some of the smaller ARM makers sidelined like what happened with AMD nearly a decade ago. This is where the context comes in, some posters above don't see the obvious correlation, what amount of pain (for these smaller chipmakers) is enough before the govt steps in, will they repeat their mistakes of the past by letting Intel get away with it again? What's the threshold beyond which others, like most on this forum, will condemn such tactics? Is there a threshold or is it every man for himself like has been the case for as long as I remember?Like this is happening for the first time right? What did the law do back then, when the damage was already done? It's not like there isn't a precedent here it's just that people conveniently choose to ignore it for whatever reason best suits them!

I personally will condemn tactics that are harmful to consumers. Low prices are good for consumers, and if Intel wants to subsidize 46 million tablet buyers I am comfortable with that. In a competitive market, which tablet SOCs absolutely is, tough competition is the best thing for consumers. The upshot of contra-revenue is that there is MORE product choice for consumers at LOWER prices than before. As far as I am concerned, that is a very good thing. I only really care about the impact on AMD, Qualcomm, Mediatek or any other competitors to the extent that the consequence is not only harmful to consumers but harmful enough to outweigh the benefit. So far I see no reason to believe there is any risk of that.

 

[Lonyo]

Could you give us an example of a company operating at a loss of > $1B per quarter for 12+ consecutive quarters? In an emerging product segment?


I can't think of one. Single. One.


Also, Tegra is your example of success? Lol.

Tegra was my example of NV running at a loss while trying to enter the mobile phone/tablet market. Just like Intel are doing.

Not billions per quarter, but:
http://www.businessinsider.com/chart-of-the-day-microsoft-losses-on-xbox-2012-6
"(Note, this chart doesn't include 2002-2004 when it piled up losses getting the business off the ground.)"

Or substitute Bing.
Or Surface.
http://www.macprices.net/2014/08/08/microsoft-surface-continues-to-bleed-red-ink/

Microsoft’s Surface tablet business has lost money each quarter, and each fiscal year since its introduction in 2012.

Computerworld’s Gregg Keizer reports that in its just-concluded 2014 fiscal year, hundreds of millions of dollars more in red ink increased MIcrosoft’s cumulative Surface losses to $1.7 billion in less than two years.

 

[Lonyo]

That's because they're mostly trying to recoup their R&D costs & reduce production costs at the same time, a hard mix. Is this what;s happening here?

I asked previously that will Intel stop contra revenues in 2015, the answer I got was probably not. So tell me spending billions on R&D, probably a similar amount in buying a sizeable chunk of their current marketshare, what they're basically doing are putting devices out their for sale which otherwise wouldn't sell if it weren't for their cheap $ tag.

Is that sustainable - sure it is for Intel, will that drive other businesses on the verge of obsolescence - most likely, bankruptcy - time will tell.

So now you tell me when do you call a spade a spade?

Intel will stop contra revenue when they have a product people want to buy on its own merits, not just because it's cheap. Which is supposed to be 2015, as the slide I posted last page shows.
To make that product, they have invested lots in R&D on the other bits required (modems and all the other things currently handled by third party or external chips).

When will you admit your problem is with Intel and whatever they do, rather than with what they are specifically doing right now?

 

[TreVader]

Tegra was my example of NV running at a loss while trying to enter the mobile phone/tablet market. Just like Intel are doing.

Tegra is failing, just like Intel. Nvidia is hardly the company anybody should "look up to" for ethics but I guess Intel has to start somewhere.


Tegra, much like Bay Trail, should never have existed. They are both huge mistakes on the part of their respective companies and represent the worst failures of each.

 

[R0H1T]

Intel will stop contra revenue when they have a product people want to buy on its own merits, not just because it's cheap. Which is supposed to be 2015, as the slide I posted last page shows.
To make that product, they have invested lots in R&D on the other bits required (modems and all the other things currently handled by third party or external chips).

When will you admit your problem is with Intel and whatever they do, rather than with what they are specifically doing right now?

You mean anything other than contra revenue, bribing OEM's against use of AMD or whatever else? My last three desktop (minor) upgrades were all Intel, last mobile one (laptop) was AMD.

I can be honest, if that's what you're accusing me of, but to say my public condemnation of Intel is puerile is stretching it a bit.

 

[Burpo]

This thread belongs in Politics & News, NOT CPU & Overclocking.. :thumbsdown:

 

[Lonyo]

So you also think NV (Tegra), Microsoft (Bing, Xbox, Surface), Sony (Playstation 3/4) and Google (Android) are bad for subsidising lossmaking products?

Yes or no, simple question.