Replies to post #116855 on Intel Corp (INTC)

[fastpathguru]

It doesn't matter whether Samsung gets "inexpensive IP" that they can customize or whether they get proprietary IP that they have to pay a premium for but don't have to develop as much. It's all about what gets the job done at the right cost.

It's a classic "upfront costs vs. ongoing costs" situation. The DIY approach requires an upfront investment and the rewards are reaped over time. Just like Intel, investing in bleeding edge manufacturing, expects to reap rewards in the long run. Clearly, Apple, Samsung, QCOM, etc. have taken the DIY approach and are reaping those rewards.

By your logic, Linux should have won the consumer desktop market a long time ago because it's essentially free and the OEMs could have used it as "inexpensive IP" that they could customize and develop for their own uses. Instead, Windows dominated despite its high price point and Microsoft's virtual extortion tactics.

I said it was a trend, not an absolute rule which is the primary driver of all product design decisions. There is no doubt that Linux is gaining ground; It now dominates the server market and the mobile market (phones and tabs). It's acceptance on the "traditional" desktop is increasing, not declining. There is no doubt that Microsoft has had an incredibly resilient hold on the consumer desktop and I wouldn't argue otherwise. (OTOH, IMHO Microsoft has never been in a more vulnerable position in the last 20 years than it is right now, with their W8 stumbling and strong, organized competitors (i.e. Google w/Android & ChromeOS) capitalizing on every weakness.)

(BTW, is there any significant market besides the Windows Desktop that has a hard dependency on x86?)

Bottom line is that there's nothing inherently better about inexpensive customizable IP over premium proprietary IP. Just ask Steve Jobs, who was adamant about the Apple ecosystem being a walled garden.

I would argue that "cost over time" is inherently better for inexpensive, customizable IP, as long as the solution fits the requirements.

From Apple's perspective, IOS is the epitome of DIY (vs. using someone else's IP.) They "rolled their own" and are reaping the rewards. That they chose a "walled garden" is irrelevant from their perspective. Consumers can take it or leave it, and in this case many are taking it, and many more are leaving it (in preference to the "un-walled garden" of Android.)

None of what you said refutes the existence of the trend I described. Note that I'm not arguing that the current trend is an absolute law of the market that cannot be broken.

fpg