AMD Scaling Back Chip Purchases from GlobalFoundries

[chiefbox]

About time they cut the cord. GF (was AMD), always struggled getting new technology processes running efficiently in time to launch new products, to meet target projections - that is one AMD's Achilles Heals. I say good move for the long run, if AMD survives that is!!

 

[azxcvbnm321]

For all you business experts who recommend a price cut, at what price would you buy a FX chip over an Intel i5? Think about it and answer honestly.

For me, there might not be a price, the FX chips are terrible due to power consumption and not at all suitable for a quality build. I'm not going to bottleneck my expensive graphics card to save $150-$219. At $50, I'd give AMD some consideration, but for many people, especially those who can afford $300+ graphics cards and are building $1500+ computer systems, an AMD chip is out of the question at any price.

And it would be far worse for AMD in terms of profits and revenues to cut their chips by 50% or more to $50 than just pay the $320 million, they aren't that stupid, they've run the figures and projections and they would lose less money by paying $320 million than cutting prices.


As for spinning off Global Foundries, do you people even know how much it costs to R&D die shrinks and then retrofitting to produce? Billions upon billions. It takes a huge amount of upfront costs that must be paid with every die shrink, AMD doesn't have the cash to invest and it's not a Fab company, it's a semi-conductor company. Getting new technology costs $$$, do you think Intel is going to teach AMD how to design and execute each new fab process? No, AMD/Global Foundries has to figure it out on their own and that costs a whole lot.

Why don't they get more customers? Don't you think they've tried? Intel is a step ahead there too with better tech and more money to pour into R&D and new Fab equipment. No one else can keep up. The money Intel spends on fabrication and retooling hurts profits in the short/medium term, but will pay off if they get so far ahead that they have a virtual monopoly like they did in the 1980's and early 1990's.

 

[tomfreak]

[citation][nom]JonnyDough[/nom]Hardly. They've been competing with Intel since their company name first became known in the IT industry. That's like saying AMD shouldn't be competing with the likes of Qualcomm, IBM, NVidia, etc. AMD is a big company with lots of good IP. There are billions of microprocessors sold every year, and if they can capture a tiny portion of that marketshare they stand to make a lot of money. They may not be able to conquer a giant at this point in time, but that's not their aim. Their aim, as a business, is to make profit. They can still do that while competing with Intel. AMD may just have to focus more on niche products, custom chips, etc. That's what smaller businesses excel at when competing with larger giants.[/citation]if they start making CPU on PCIE expansion card, I might be buying them again.

 

[InvalidError]

[citation][nom]beayn[/nom]Sadface for AMD. Lack of competition means steeper Intel CPU prices for everyone.[/citation]
Maybe for higher-end computing but at the lower-end where most people are not really dependent upon a PC for much of their everyday life, Intel becoming too greedy might throw that whole market segment into open ARMs.

For people who use their PCs mostly for reading webpages, watching YouTube videos and Skype, a simple $200 tablet would get the job done just about as good as a $400 laptop/PC. For long typing sessions, an USB or BT keyboard is always an option. In most cases, external HDMI display is also available.

Another problem with Intel increasing their CPU prices is that performance barely doubles about once every 4-5 years now so there isn't much pressure on most people to upgrade as there used to be. If Intel gets too greedy, people who cannot be bothered with 30-70% performance upgrades will simply stretch their existing systems from 3-4 years to 5-7 years.

So, whatever happens to AMD, I am not particularly worried about Intel's CPU prices because Intel will still need to compete against itself (offer compelling reasons for people who already have PCs that get their job done to upgrade anyway) and ARM encroachment.

 

[tomfreak]

[citation][nom]InvalidError[/nom]Maybe for higher-end computing but at the lower-end where most people are not really dependent upon a PC for much of their everyday life, Intel becoming too greedy might throw that whole market segment into open ARMs.For people who use their PCs mostly for reading webpages, watching YouTube videos and Skype, a simple $200 tablet would get the job done just about as good as a $400 laptop/PC. For long typing sessions, an USB or BT keyboard is always an option. In most cases, external HDMI display is also available.Another problem with Intel increasing their CPU prices is that performance barely doubles about once every 4-5 years now so there isn't much pressure on most people to upgrade as there used to be. If Intel gets too greedy, people who cannot be bothered with 30-70% performance upgrades will simply stretch their existing systems from 3-4 years to 5-7 years.So, whatever happens to AMD, I am not particularly worried about Intel's CPU prices because Intel will still need to compete against itself (offer compelling reasons for people who already have PCs that get their job done to upgrade anyway) and ARM encroachment.[/citation]exactly I am not too worry either, high price CPU is pretty much sending the market to ARM. ARM is Intel's biggest threat now. Not AMD.