Replies to post #139427 on Intel Corp (INTC)

[Unkwn]

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. That's going to result in state-of-the-art process benefits, as well as a much better margin structure. If they can make headway with SoFIA at 28nm, then by the time they move it to their own 14nm, will be a huge competitive advantage for them.

Yes, in theory. In addition, the server and PC business already pays well for those fabs so the additional volume from mobile can just be seen as a way of distributing the fixed costs a bit, so the margins from PC and server processors get even better. In addition, Intel doesn't have to pay for processor and graphics IP, since they own it. In theory, this should be a big pricing advantage ...

but in practice, Intel screws it all up and doesn't go anywhere. They just failed so far and it's a shame really. They had all the advantages they could possibly get at their transition to 14nm. If they had released a fully competitive and integrated mobile SoC at 14nm, they would have crushed the competition with pricing and performance. But, well, they failed big time. There's nothing to excuse. Time to market, product and platform design from all Silvermont incarnations were just bad. Airmont is a mere shrink, what the hell are they thinking?

I am telling you, if they don't pull all the triggers they have with Goldmont and the transition to 10nm, they are out of this business and the risk of holding Intel increases a lot. They won't be the best foundry out there, especially not without a process lead, which they are about to lose at 10nm I suspect (or just a very thin lead).

[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.