more on On AMD, Apple, Intel, IBM and The Great Game of Chips

[David Farber <dave () farber net>]

Begin forwarded message:

From: Newmedia () aol com
Date: June 6, 2005 12:30:50 PM EDT
To: dave () farber net
Cc: amaah () comcast net
Subject: Re: [IP] On AMD, Apple, Intel, IBM and The Great Game of Chips


Koranteng:

1) AMD does *not* have its Dresden Fab 36 humming along and won't  
until sometime next year.  As a result it is capacity constrained and  
cannot really do any damage to Intel at the moment.  Transitioning to  
300mm and then 65nm could be a challenge -- even with IBM's help,  
which is where most of this technology comes from them.  Most  
importantly, as regards AMD's stock, they will probably have to  
successfully spinoff Spansion to get any "respect."

2) While AMD does have a better mousetrap, they still don't have what  
IBM can offer with its Power 5 and upcoming Power 6 families.  The  
Apple G5 is one-half a dual-core Power 4.  AMD's next generation K-10  
is being designed by an ex-IBM Power 4 architect.  When it come to  
high-performance memory and I/O capabilities, the current sweepstakes  
has IBM in first, AMD second and Intel in a *distant* third.

3) There is a fundamental battle going on between standard and custom  
parts.  The economic and price/performance tradeoffs are massive.   
Apple is presumably replacing the standard Freescale G4 parts with  
standard Intel parts but this still leaves open the matter of the  
custom G5 parts they get from IBM.  Where will the future volumes  
be?  Which markets -- games, TVs, cellophones, cars, etc. -- will go  
which way?

4) Right now AMD (like Intel) makes standard parts.  Will AMD shift  
towards custom parts -- like IBM?  Do the customers really want to be  
competing with Intel's most-favored-nation Dell?  Who should get the  
profits -- Intel or the systems vendor?  What will happen in China -  
now that IBM owns a big chunk of Lenovo?

Glad you like AMD -- so do I but there are still many fundamental  
issues unresolved as we rapidly deploy the next-generation platform  
and prepare for global expansion in digital services.

Best,

Mark Stahlman
New York City

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