Intel Corp (INTC)

[Dmcq]

Intel has a huge advantage, in that they are once again in control of their own fabs, and once they transition to 14nm, do not have to pay TSMC as a middleman.

There's a saving in management and communication but just having one cost base instead of two does not automatically save much money. And if you're talking about margin if each cost base has the same margin that is the overall margin - not something additional or a multiplier. For this reason one has got to ask oneself how efficient each separate bit is in itself, usually there is a loss in this in a merger which is balanced against the easier communication and overall management. For instance in this case TSMC have to use a more generalized process which corresponds with the loss in communication but they are able to use their foundries for longer as they have a wider customer base.Samsung I guess are hoping to get the best of both worlds by operating a fab but having good insider knowledge for the leading process.