Intels in trouble..

[Meghan54]

I think the people who spell death for AMD need to think about just how bad life on the PC could get without AMD in the market

And finally comes the tired, old, lame argument of "CPU prices will triple when/if AMD dies."

Honestly, do you really think Intel would significantly raise cpu prices if AMD suddenly disappeared? How would Intel continue to make their margins if they massively increased prices for their cpus?

It won't happen. No amount of doomsday prophecy will change the fact that the PC market is, overall, very price sensitive and a sudden, massive increase in prices would definitely shrink sales of said more expensive PC's, and by extension, shrink Intel's margins substantially.

Honestly, you really have no understanding of business, do you OP?

 

[Torn Mind]

And finally comes the tired, old, lame argument of "CPU prices will triple when/if AMD dies."

Honestly, do you really think Intel would significantly raise cpu prices if AMD suddenly disappeared? How would Intel continue to make their margins if they massively increased prices for their cpus?

It won't happen. No amount of doomsday prophecy will change the fact that the PC market is, overall, very price sensitive and a sudden, massive increase in prices would definitely shrink sales of said more expensive PC's, and by extension, shrink Intel's margins substantially.

Honestly, you really have no understanding of business, do you OP?

Intel could raise prices and probably would, but they still have a constraint as to how high they can go. They cannot allow volume sold to decrease too much or else they won't make as much money. Raise it too high, and they would drive the OEMs like HP, Dell, etc, who are the major buyers of CPUs right out of business.

AMD did nothing to bring the prices of Sandy Bridge's processors down. In fact, they were the ones lowering the prices of the FX-8150 eventually down to 2500K levels.

 

[Idontcare]

I think the people who spell death for AMD need to think about just how bad life on the PC could get without AMD in the market

Even if this were true, how would doing the math incorrectly suddenly change how good or bad life on the PC will get?

None of us can change the math. Here's some math:

People who spell death for AMD are simply people who can do math. It has nothing to do with wishes, hopes, desires, or dreams.

And you have a 50/50 shot at correctly answering the following question: which has an impact on AMD's financial future? math (accounting) or wishes and dreams?

Compare AMD to virtually anyone on that chart and you will see they are being vastly out-spent in R&D in every segment they are attempting to compete.

GPU? x86 CPU? ARM CPU?

In every segment they are the david going up against a goliath. What is the inevitable outcome of that approach?

And you do understand why Intel is not in the gaming console market, right? No one makes much money in the hardware. Sony and MS lose money on hardware and they sure as heck aren't buying the components at prices that command 50% gross margins for the suppliers.

 

[ShintaiDK]

One would add this too, with revenue numbers for 2012:

 

[mrmt]

People who spell death for AMD are simply people who can do math. It has nothing to do with wishes, hopes, desires, or dreams.

The latest analyst forecasts, people who can do math and make a living out of it, point out for AMD arriving in 2014 with the bare minimum amount of cash to run their operation. If there is someone in trouble here it is AMD.

Their latest wins, gaming consoles and embedded, are always a race to the bottom in terms of prices and margins for obvious reasons. Whoever is expect AMD to rebound on those two business is spreading FUD, daydreaming or doesn't have a clue.

Not even AMD expect those two business alone to sustain the company in the long run. They wouldn't invest in something so alien to their competences like an ARM chip if returns were in embedded/consoles.

 

[Meghan54]

Intel could raise prices and probably would, but they still have a constraint as to how high they can go. They cannot allow volume sold to decrease too much or else they won't make as much money. Raise it too high, and they would drive the OEMs like HP, Dell, etc, who are the major buyers of CPUs right out of business.

AMD did nothing to bring the prices of Sandy Bridge's processors down. In fact, they were the ones lowering the prices of the FX-8150 eventually down to 2500K levels.

I'd agree that if AMD disappeared, Intel most likely would raise prices, but only marginally. As you alluded to, Intel's now stuck with trying to move increasing volume every year, and that'd never happen if their prices moved upward substantially.

Intel's sorta stuck with their own success and historical pricing.

 

[FridayThe13th]

Qualcomm is relevant because they compete against intel in the mobile CPU space. You think intel is safe because it has big market cap vs AMD who doesnt?

You forget that Qualcomm and Samsung have the money and technology to beat intel in the Smartphone and Tablet space.

Intels core markets are declining and they have no solutions in the new markets. Even if they did they would have to wave goodbye to its huge margins which the company is based on.

You can twist my comments as much as you like but AMD has a real chance with gamers now its in the PS4 and Xbox. This could turn the tide for AMD and allow it to regain performance lost over the last few years.

Intels share price is down 30% in the last year alone. If the future was so rosey for intel then their share price wouldnt be so deflated.

we are talking about amd vs intel

when i read qualcomm is relevant i stopped reading the rest of your post.

you are truly delusional, or truly need some therapy.

when talking about the knicks vs the lakers, we dont start talking about the philadelphia 76'ers

One would add this too, with revenue numbers for 2012:

@OP - when you lost a fight, and youre on the ground getting your face kicked in, that should be your low point where you figure out its best to stop trash talking.

This being said, you use no facts, you dont stick to your original argument, and you keep jumping ship when proven wrong, stop posting in this thread as you are not a good troll or a less than not smart person

 

[Sable]

Not this AGAIN?!?!?

 

[Meghan54]

waffles are good!


Mmmmmmmmm............bacon!

 

[mrmt]

I'd agree that if AMD disappeared, Intel most likely would raise prices, but only marginally. As you alluded to, Intel's now stuck with trying to move increasing volume every year, and that'd never happen if their prices moved upward substantially.

It's curious how the strategies of both companies are perceived so differently from what they are.

Intel is moving full steam ahead with small, compact, efficient chips because they need high volumes and high yields to pay for their fabs and bleeding edge process, and they into the high 50-low 60's margins.

In order to stay barely competitive, AMD fields more of everything: Moar Cores (!!!), Moar power consumption (!!!), Moar thermals (!!!), Moar die size (!!!), Moar missed specs (!!!). The consequence of this brute force approach is higher COGS, and as their price ceiling is capped by Intel, lower margins.

By looking at the results of both companies, it is clear who needs higher prices on the market. From every way you look you can see AMD bleeding cash and that because of the low prices they get for their processors. In other words, it is AMD who needs higher price to survive, not Intel, and right now the company is literally killing itself selling their chips at such a low prices.

But yet what we see is an avalanche of posters reminding us how AMD is the company that keeps Intel in check, the maintainer of lower prices on the market. Go figure.

 

[Phynaz]

One nice thing about AMD getting the consoles is it will hopefully reduce the numbers of wafer they don't have to buy from GloFo, if you get my meaning.

 

[Torn Mind]

But yet what we see is an avalanche of posters reminding us how AMD is the company that keeps Intel in check, the maintainer of lower prices on the market. Go figure.

How quickly they forget the original MSRP of the Bulldozer FX-8150. It wasn't meant to undercut prices against the i5, but rather the i7s, with its $270 initial price tag. Now, we're paying $199 for the FX-8350. Better for the consumer, but not in the way AMD intended. If AMD had their way, they'd still be charging $270. But the backlash against Bulldozer was so terrible, the FX series would not sell if it was priced higher than an i5.

 

[Ketchup]

I think I see what your problem is Fx1. You like consoles. AMD will have a good piece of the console market in the future. Therefore, Intel is in "trouble."

Unfortunately, your perception of the size of the console market is quite exaggerated; and you are assuming, based on the numbers we have been seeing, that AMD is even going to make it that long.

 

[IndyColtsFan]

So am I.

Intel has challenges in the next few years, but they're not from AMD.

AMD will be doing well if it still exists in five years, much less taking on Intel.

This.

Let's not forget that AMD supplied the GPU in both the Wii and Xbox 360 and they were still losing money. They'll be making razor thin margins on the components this next generation, so I wouldn't exactly be writing Intel's obituary yet.

 

[FridayThe13th]

OP finally realized his rant became a quick fall into the pit of reality.

AMD launches new 8 core processor , "AMD RIP Series"

 

[ShintaiDK]

One nice thing about AMD getting the consoles is it will hopefully reduce the numbers of wafer they don't have to buy from GloFo, if you get my meaning.

But they will be made at TSMC

 

[Phynaz]

Oh...well nevermind then

 

[zephyrprime]

I don't think it will hurt intel much. What intel really lost out on was a chance to increase usage at their fabs. With sales down, intel is going to be losing a lot of money with their spare fab capacity. That's why you had intel doing stuff like offering to fab Apple's chips for them. They need something to soak up their fab capacity and console wins would have done that since consoles have such high volume. Since they have sucky graphics and no efficient small core that is competitive, they weren't even in the running.

Optimizing for AMD cpu's isn't going to hurt Intel as much as you think. Targeting cpu optimizations yields little difference between AMD and intel. There is much less complex programming and processes in a cpu than in a GPU which has so much specialized functionality and a large driver program that it is running to. Nvidia will be hurt more because gpu optimizations has a much bigger effect than cpu optimizations. Also, when it comes down to it, the computer gaming market just isn't very important in the grand scheme of the market.

Also, the new gen consoles could help intel in one way. With 8 cores in the next gen consoles, developers will finally focus more effort on making more heavily multithreaded code. With software that can finally use more cores, consumers may actually want to buy an 8 core processor which would be a boon for intel (and amd for that matter).

If Intel had the ability to focus on more than one thing at a time, they would have been able to maintain their development of ARM back when they had strong ARM and they would have maintained their development of Atom after that was a hit. But nope. Intel can't focus on more than one thing at a time so they let their secondary product lines stagnate and now they are rushing to catch up.

 

[sandorski]

I wouldn't say that Intel is in trouble. It's more like, there's hope for AMD.

 

[notty22]

Contracts for the consoles were bid and won by AMD many months ago. This is not news to anyone that follows tech news. Most of the layoffs of key ATI/AMD engineers and upper marketing that took place in late 2012 were involved with those projects. Two of the fellows are now at Nvidia.
Not sure if this prediction is any more Paul Bunyan than one that had the consoles which won't launch till November, raising AMD's quarterly profits this year.

 

[Golgatha]

1. 
   
   
   I would agree though that Intel's traditional > 50% margin model is under threat and ultimately unsustainable, and as a consumer I heartily welcome that because I want the best bang / buck.

1. 
   
   This is probably the biggest threat to Intel right now. Those huge margins won't fly in a "good enough" world. My current i7 3770k is much faster than my old i7 960, but most people don't care about that difference at all. The old i7 960 is "good enough" and the prices will need to come down for people to even consider upgrades. This is all my own prediction based on personal experience and some business theory I've studied, so take it for what it's worth.

 

[mrmt]

This is probably the biggest threat to Intel right now. Those huge margins won't fly in a "good enough" world. My current i7 3770k is much faster than my old i7 960

And your old 960 is 263mm^2 die size against 160mm^2 size of your current 3770k. Doing more with less, this is Intel mantra since Conroe. The whole gross margin discussion is a moot point because what really matters is cash flows, but FWIW, a 50%+ gross margins model isn't unsustainable as long as you keep costs in check, and Intel is doing just that.

 

[videogames101]

Intel is doing fine on the business side of things, clearly. You can't misinterpret their massive revenue.

However, speaking to the future, I hope we don't start accepting "good enough" when it comes to CPUs, not until compute reaches a FLOP density orders of magnitude higher than current designs.

/Anxious for Haswell

 

[slayernine]

I'd agree that if AMD disappeared, Intel most likely would raise prices, but only marginally. As you alluded to, Intel's now stuck with trying to move increasing volume every year, and that'd never happen if their prices moved upward substantially.

Intel's sorta stuck with their own success and historical pricing.

The real problem is what market segments would see the largest year-over-year increase. The enthusiast market would get screwed, over-clocking would be non-existent and high clock speed parts would be $1000+. The server market would also see zero processors below around $600 and the high end server parts would be sky-is-the-limit expensive. This wouldn't happen overnight but it would happen eventually. Consumer devices would see moderate price increases but not that much as consumer devices are the most price sensitive.

 

[Torn Mind]

The real problem is what market segments would see the largest year-over-year increase. The enthusiast market would get screwed, over-clocking would be non-existent and high clock speed parts would be $1000+. The server market would also see zero processors below around $600 and the high end server parts would be sky-is-the-limit expensive. This wouldn't happen overnight but it would happen eventually. Consumer devices would see moderate price increases but not that much as consumer devices are the most price sensitive.

I think AMD is already non-competitive against LGA 2011 and the server market. And there has always been a $1000 processor.