Replies to post #63125 on Advanced Micro Devices Inc (AMD)

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Re: I already expalined AMD's partner centric, vendor centric, consumer centric parameters that have a liberating affect vs Intel's leverage, etc. I dislike the "might makes right mentality". There is my bias.

Maybe your bias is the reason why you paint things in black and white, rather than recognizing that even large corporations like Intel can work mutually with their partners, vendors, and for the consumer.

Even if you believe Intel management to be a fairly cold group of individuals looking to make their profits by any means necessary, it's still obvious that they have to offer something beneficial to the people who support them if they want them to stay loyal. Do you really think that Intel's vendors are so fed up with them that they would move to AMD as a matter of principle, provided your argument that the AMD platform had the performance and features necessary so that the vendor wouldn't be giving up business to sell their products at the expense of Intel's?

What do you think keeps Dell loyal, or Toshiba? What makes IBM continue to invest millions in joint Intel developments, in spite of their manufacturing relationship with AMD? What about the hundreds of press releases about Intel working with industry players in the areas of WiMax, next generation wireless networks, new memory standards, etc?

The fact is that whatever motivates Intel in the executive board room is the exact same thing that motivates AMD. You can't describe Intel as a faceless corporation and at the same time paint AMD as the Company Who Cares. They both try their best to keep their customers happy, even though sometimes, someone will ultimately be burned in the process.

I doubt the Linux companies benefit very much with Intel's relationship with Microsoft, for example, but that doesn't mean Intel's relationship with the Linux vendors has turned sour. In fact, Linux is a very big part of Intel's server business, and they continue to work very well together. The same can be said for AMD, and their relationship with Microsoft and the Linux vendors.

That's why the argument about vendors eager to leave Intel for a second supplier is nonsense. They want a second supplier around, simply because it makes business sense to have a second supplier in case of a surge in demand or simply for a diversified product line. AMD works for these situations, which is why they've always held between 10-20% of the market.

In order for them to grow beyond 20%, they need to be more than a second supplier - they need to be the preferred supplier, and I doubt buy the argument that Intel's customers aren't satisfied with Intel's service. I'm sure the occasional rumor from the Inquirer of discontent among Intel's vendors has a grain of truth, but like I said above, sometimes this can't be helped. Overall, Intel has always been a reliable supplier. They've had difficulty in their roadmaps from time to time and a couple of product recalls in the past, but no more than any other company. In fact, there are plenty of companies with preferred product lines that perform recalls all the time (IBM, Sony, Apple, etc). These mistakes aside, however, Intel is the premier x86 supplier, which they manage with their decades of manufacturing investment.

AMD has a chance next year to get additional manufacturing, but unless they become the preferred supplier with products whose superiority can last beyond the usual leapfrogging that goes on in this business, those fabs are only going to be filled as far as demand is available. Intel's success certainly has the chance to turn AMD's capacity into a dangerous case of oversupply.

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Re: You OTOH only say thing like this platform will catch up or some reasoning why Intel will do well financially. As if you want to jump/stay on the winning bandwagon, "things haven't gone well, but are supposed to turn, while AMD might run to 30", your aproximate words.

Wait, what are you saying here? Do you think there is anything wrong or inconsistent with that summary?

"things haven't gone well" - no they haven't in some ways, but in spite of that Intel is making record revenues and their fundamentals have never looked better.

"but are supposed to turn" - right, Intel's competitive situation will improve dramatically next year, which will likely alleviate investors' concerns for increased ASP erosion.

"while AMD might run to 30" - I don't know which way the speculators will take the stock, and I don't really care. They may take the stock to $30, or it may have already hit its peak. I'm investing in INTC because it's based on a company already well valued with plenty of prospects for the future.

Re: What made you decide and keeps you believing Intel was/is the holy grail?

Just look at their YoY growth since the .com implosion. INTC has done exceedingly well from year to year, even in intensely competitive conditions. The company is solid, their manufacturing and market departments are top in the industry, and their development teams are ready to deliver some outstanding products over the next year. Not only that, but the stock is already priced rather conservatively, as investors' concerns are overblown. If you were to look at any other company with these qualities without having a biased detachment, you'd be jumping on the bandwagon, rather than trying to argue against it.