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AMD says the channel is in good health

by Scott Bicheno on 30 June 2010, 11:01

Tags: AMD (NYSE:AMD)

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A matter of choice

Since the great culls of the 2008 and 2009 AMD has been relatively quiet. Much of its UK activity - such as PR - is now part of a pan-EMEA operation and most of the noise it has been making has been focused on notebooks and the OEM channel via its Vision brand.

UK country manager and channel boss Andrew Buxton, however, was keen to stress that both AMD and its channel are quietly doing quite nicely when we met for a bite to eat in central London

"Rumours of the demise of the channel have been greatly overstated," said Buxton, as he perused the wine menu, opting inexplicably for a Chardonnay to have with the steak. "We shipped more units in the EMEA channel in 2009 than ever before, so the component channel is still healthy."

But it's easy to see where these rumours may have originated. Surely everyone wants a notebook these days, those who haven't concluded the tablet is the best thing since sliced bread, that is. That was what was so clever about AMD's Vision strategy - stop trying to tackle the engineering and manufacturing might of Intel head on, and play to your strengths.

Unlike the component channel, most notebook consumers aren't really that bothered about the speeds and feeds of their devices, they just want it to deliver certain functions, reliably, for a given price point. Centrino has been a great brand for Intel in that end-users associate it with notebook reliability. AMD wants them to do the same with Vision.

But there are still plenty of consumers - as evidenced by the undiminished popularity of this very website, who want their PC to be more than merely functional, and for them the desktop still reigns supreme.

"Entry level desktops are being eaten into by notebooks, but the average selling price of desktops is going up," said Buxton.  "If you're a gamer, you need a desktop; the high-end desktop market is here to stay."

That doesn't mean it hasn't been tough for AMD and the component channel. AMD's proposition remains bang-per-buck competitiveness, and this delicate balancing act isn't made any easier by the continued turmoil in the world's economy.

"The big challenges are exchange-rate related," said Buxton. "The channel needs predictability and stability." Recent business practices have been for AMD to retrospectively protect the channel on CPU price moves for one or two weeks.

By the end of our chat, we'd also received an explanation for the Chardonnay choice. Apparently Buxton has lost a couple of stone on what he called ‘the Chardonnay diet', which essentially involved drinking wine instead of beer. When we expressed a preference for Sauvignon Blanc, Buxton paraphrased the founder of his company in replying: "Real men drink Chardonnay." We still beg to differ.

 



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By the end of our chat, we'd also received an explanation for the chardonnay choice. Apparently Buxtion has lost a couple of stone on what he called ‘the Chardonnay diet', which essentially involved drinking wine instead of beer. When we expressed a preference for Sauvignon Blanc,
That does nothing to explain why he (and apparently, you as well) would pick a white wine over red to go with steak!!? :p

Fair comment about component market - fewer numbers but enthusiasts will be willing to pay a premium (evidenced by rising prices) so it's still worth staying in.