We've done a bit of chatting about AMD around these parts of late. I rocked the boat by suggesting that AMD had made some bad decisions that could do it some harm, particularly in the short term, while James Morris looked further into the future, to a time when AMD's likely to be back in line with, or in front of, Intel in performance terms.
So while James and I have different takes on how AMD's faring right now, I think we can both agree that the company is still very much in the running, regardless of whether its current actions are hurting it and if its future products will do them any good. So what about Intel? Apparently, it's going to go bankrupt in a matter of quarters.
Come again?
But before I step into that alternate reality and somebody closes the door behind me, allow me to get something off my chest. If there's one thing about the Internet that I hate, it's weblogs. Particularly, two types of weblog. There's the weblog of the angst-ridden teen; I don't think I need to explain why they're a PITA. Then, there's the weblog of the person who seems to think that what they write is the gospel truth. Such people write their opinions as though they are fact. Not a good thing, especially when people start believing it.
I'll excuse one type of weblog from my cross hair, and that's the weblog of insight. You know, the sort written by people with something interesting to say. People who convey to us what goes on someplace; who actually write interesting stuff, without preaching their opinions too much.
But if I had to, I'd shoot down all weblogs, just to be on the safe side.
So why the aggro and WTH does it have to do with Intel and bankruptcy? It's those preachers, folks. They're trying to convince people that absolute bull is the truth. E.g. the journal of pervasive 64-bit computing, which, ironically, is nothing to do with pervasive 64-bit computing, but rather is a platform for one person's pure fanboyism. It pains me to dignify the page with a link, but I feel I must. Give it a read, notice the one-sidedness, and laugh at the insanity of it all.
Luckily the 'blogosphere' tends to balance itself out, but I'd rather kill the whole thing so we don't have to deal with all the white noise the damn thing generates.
Real news
Let's think about the claims that Intel's going down the drain by starting with some recent news from, oh, I don't know, maybe a reputable news source?
Shares of Intel Corp. rose more than 3 percent on Wednesday, a day after the chipmaker indicated it may be moving past problems it has faced from heavy competition and softer demand.
Intel, which makes the vast majority of chips for personal computers, reported a 35 percent drop in third quarter earnings on Tuesday, but issued a fourth quarter revenue forecast that matched expectations and indicated its price war with Advanced Micro Devices Inc. may be easing.
Just that quote alone says a lot about the position Intel is in, but permit me to elaborate...
AMD's been the performance king by a varying margin since the Athlon 64 hit the scene, if not before. In the past year or so, it's chipped away at Intel's market share, thanks in part to its Opteron processors, which have been favoured by many in new servers and workstations. AMD's pricing has tended to be aligned such that you get more performance for your money than a similarly priced Intel chip.
Intel knew it had to act, and it took perhaps a little too long to realise that NetBurst wasn't going to scale to 10GHz, but it's come up with Core, and, boy, is it fast. Add to that the fact that Intel has been waging a rather fierce price war with AMD of late, and the appeal of its Core mArch-based CPUs has grown, particularly the undeniably awesome Core 2 Duo/Extreme.
All this beavering away on a new mArch, along with a massive ad. campaign, price war and fabrication process shifts, has hit the company financially. Intel's even been selling off some of its 'deadweight' to streamline its operation. It took AMD long enough, but it has definitely got Intel's attention, and Intel's reacted fiercely. Do remember that Core 2 hasn't been on the scene all that long; while it's a mighty mArch, it can't make a quarterly result look amazing by magic, right?
But now that the initial frenzy is over, and Intel isn't on the back foot any more, things have a chance to calm down, as suggested in the aforementioned Reuters article. The company has quad-cores on the way next month (though not in great volume until next year), along with some pretty funky stuff in the works for the future. It's AMD's turn to respond, which it will, with rev. G Athlon 64s and beyond that, K8L.
The important thing to consider is that Intel isn't going to sit still while AMD responds to it. Neither company can afford to be complacent because the competition now is hot as a baked potato fresh from the oven. That's fantastic news for us, because it drives CPU technology forward.
Intel's not going to price its chips so low that it does itself any serious damage; it's just making an impact... a statement. AMD can't match anything like Intel's manufacturing capacity, and it's hard to see how it will ever be in a position to significantly out-do Intel in this respect. That alone keeps Intel in a strong position.
So, in taking back the performance crown Intel's had to make some sacrifices and take a few hits, but ultimately it's going to pan out well for the company, especially while AMD struggles to supply chips to those who want them. Neither company is going anywhere, and the gauntlet is laid down for some great competition between green and blue over the next few years. Ignore fanboys, especially fanboys who think a Ph.D gives them the right to talk rubbish. Simply sit back and enjoy the benefits of a CPU market that's excitingly competitive right now.
And finally...
There's a distinct lack of financial analysis in this article, for the sole reason that I'm an expert in hardware, not a financial analyst; I'm not going to pretend to be something I'm not. Still, I'll leave you with this fairly simple thought: If Intel was in any serious danger, shouldn't shareholders have been running scared in their masses by now?
