Advanced Micro Devices Inc (AMD)

[bobs10]

It's going to be very humorous to revisit this line in another 12 months. Don't worry about forgetting it, because I'll remind you.

Me...

I predict selective recall.

On the subject of black and white, all you guys/gals seem to be able to differentiate is 2 shades of gray. INTC isn't going to disappear from the planet next year. At best, If AMD were able to sell everything fab30 and 36 could produce AMD would still only be able to take about 50% of the market.

What you seems incomprehensible to you is that once AMD gets to 25 to 30% of the market all sorts of things change. At that point INTC looses control of pricing and has to follow AMD with price cuts down to AMD's ASPs. That alone would be disastrous for INTC earnings, but to counter the effects of reduced revenues INTC is then forced to start closing fabs and laying off personnel to try and get costs in line with revenues.

INTC is used to operating in what might be called the Cadillac mode of operation with too many people and levels of management. Having to make the necessary adjustments will be very disruptive to the company and result in all sorts of dislocations that will ultimately affect both products and customer relationships.

The way I see it in 06 is that AMD continues the HP model with more and more INTC only clients slowly adding AMD product lines. Even Dell eventually is going to be forced to face the music.

Looking at Dell and INTC kind of reminds me of a couple standing on the deck of the Titanic(Itanic?) embracing each other as they await their fate.