Replies to post #12426 on Advanced Micro Devices Inc (AMD)

[sgolds]

Elmer, that would be a wonderful scenerio for AMD! Think of it: AMD will not have the capacity to seriously challenge Intel market share on 90nm, and even at 65nm it would be a huge challenge. Now, assume Intel continues on their schedule to push Itanium - which is far, far away from becomming a competitive desktop. Where does that leave AMD?

Implementing the most popular 64-bit PCs in the world! Let's say that grows to no more than 25% of the x86 market, and Intel has the other 75%. Traditionally, AMD has had to accept way less money than Intel for processors. Now, however, AMD has desktop, mobile and departmental server product which can support all Intel applications, and a bunch of high-end applications which Intel can't touch!

With Ruiz' philosophy of actually getting paid for the quality of the processor, that leads to economic models where AMD gets more $ per processor than Intel (something unprecedented). To get a premium over Intel, AMD needs two things to happen:

1. Have a clearly better product that runs all Intel applications and many desirable applications that Intel can't run;

2. Limited production so that AMD goes for the high end of the market and does not compete with Celeron.

It would make an interesting profit picture!

(Software note: It would be a boon to software vendors also. They will be very motivated to make premium product for a premium platform - which results in a higher price that the customer is willing to pay. Also, try running one of those apps on a Celeron in Asia! Discourages illegal copying.)

[DDB]

I don't think there is enough 130nm - 90nm capacity in the world to displace Intel. If x86-64 suddenly became the CPU of choice it would be many years before capacity could be put in place to overtake Intel and nobody has the $$$ and process/manufacturing technology to do it. Intel is #1 for years to come if for no other reason than without Intel's fabs and manufacturing infrastructure the world can't produce enough silicon to replace them.

Very true. Only way out would be that Intel comes into financial struggles that it has to sell some fabs.

DDB

[UpNDown]

Elmer, on capacity constraints

I agree with you that AMD can't satisfy such a steep jump in demand. But what I was saying was more along the lines that with AMD64, the x86 line is complete and able to bridge the application gap from simple consumer or business apps to the most complicated 64-bit apps and even some (possibly most)supercomputer-type needs.

This makes x86 even more dominant than it has ever been in the past. AMD64 is just the final part of that dominance. The side effect of x86 dominance through to 64-bit and cluster systems is that alternative architectures, including Itanium and the new Sun machines, will have a much more difficult foe to dislodge.

And my speculation is that that particular battle, with AMD64 added to the x86 side, is too uphill for any other alternative architecture to succeed.

[kpf]

elmer

I do completely agree AMD overtaking Intel cannot happen anytime soon.

However, as for "nobody has the $$$ and process/manufacturing technology to do it":

Think about one or two megafabs (better said a hyperfabs, talking about tens of thousand 300mm-waferstarts per week) in mainland china to be built in 2005, going online in 2006 on 65nm node. Volume at mature yields in 2007.
China has the $$$, look at their trade balance. AMD should have leading-edge process-technology by 2006 (admittedly a lot of it transferred from IBM).

In the meantime FAB30 plus East-Fishkill would be sufficient for AMD to grow into the 30% MSS range in the 90nm node.

That's the way it seems to me.

K.