Moment of truth
While everyone else operates on single figure margins as they all jostle to offer the most gigahertz and megabytes for the least money, one company sells sexy, desirable PCs at prices the likes of HP and Dell rarely dare attempt.
Most OEMs have had a go at producing their own sexy products, with Sony and its Vaio brand being a conspicuous example; but perhaps because they're still judged by the metrics of their component parts, they have yet to replicate this ability to sustain high margins.
In attempting to redefine itself as a platform company, AMD is trying to move away from the culture of looking at a PC as the sum of its parts. Unfortunately for AMD, the one conspicuous platform success in the PC market has been Intel's Centrino, which has become synonymous with notebooks for many consumers.
AMD desperately wants to have similar success with a platform of its own, and Yukon/Congo could be its chance. But to do so it must overcome the twin challenges of relatively meagre marketing resources and insufficient influence over end products.
Is AMD going to keep on trying to beat larger, richer rivals at their own game or is it going to do something different?
My feeling is that, as it comes to the end of its ATI integration phase, a moment of truth has arrived for AMD. Is it going to keep on trying to beat larger, richer rivals at their own game or is it going to do something different?
With its ‘platforms' strategy AMD probably barking up the right tree but it's got to be able to produce an end-product that demonstrates its point, and to do that it needs the help of a big system builder. If AMD can create an association in consumers' minds between its logo and some mysterious ‘secret recipe' that gives PCs added mojo then it will be a long way towards achieving its stated aims.
