Intel Gets Start of Antitrust Backlash from OEMs

[enigma067]

Intel Gets Start of Antitrust Backlash from OEMs

By Erik Sherman | Jan 4, 2010

A recent announcement that Lenovo would use CPUs from AMD (AMD) in a couple of its ThinkPads rather than chips from Intel (INTC) is the beginning of the price the chip giant could end up paying for its alleged anticompetitive activities: OEM customers shifting their orders.

In two separate statements, Lenovo said that it would use AMD chips in the ThinkPad X1003e ultraportable as well as the 13-inch ThinkPad Edge series, which is aimed at small- to medium-sized businesses. This is the first time that the ThinkPad brand, originally owned by IBM, will have used non-Intel chips:

An ultraportable PC positioned between a notebook and a netbook, the ThinkPad X100e can be equipped with AMD’s Athlon Neo single-core and dual-core, as well as the Turion dual-core processors. The ThinkPad Edge model, the smallest of three offerings in this product family and targeted at small and midsize businesses, may be paired with dual-core AMD Turion and Athlon Neo processors. The 14-inch and 15-inch ThinkPad Edge versions will still be powered by Intel’s Core 2 Duo chips.

Before you say, “But those are the small systems,” remember that the smallest systems, like netbooks, are the ones whose sales are really growing. To put it differently, AMD may not be in the prestige machines, but they’re going into the ones that may get the greater volume sales.

Starting in mid-November, I began noting that the upshot of all the antitrust activity focused on Intel would be customer defections:

PC vendors get completely wary of being sucked into the investigatory void and start shifting a significant portion of their purchasing to AMD. Forget fines and forget legal fees. That’s going to be the real price tag for years of allegedly using money and influence to keep a competitor constrained, and it will be a number with a whole lot of zeros.

I think the Lenovo switch is the first sign of that real price tag. Who knows how large a card it will need to be to record all the potential long-term loss for short-term gain?

Image via stock.xchng user MeHere, site standard license.

http://industry.bnet.com/technology/10004584/intel-gets-start-of-antitrust-backlash-from-oems/

 

[roofus]

well 133 a piece in 1k trays isn't significantly more than they paid for some of the core2 parts is it? i haven't kept up on tray pricing in years.

 

[theholylancer]

Wait a minute, you mean to tell me that you are referring to GF's Malta fab that is suppose to come online in 2012 and won't have any chips till 2H of 2012? This is a foundryright, so they probably will be making chips for a bunch of other companies as well unless your sources say that they will be starting 50k wafer starts a week then it's going to be tough pushing out all those cheap chips. I guess I'll wait a bit longer before I invest especially since you are also assuming that they will be making smaller chips because they are going to smaller node just because it's smaller.

well I think what they mean is, good enough performance vs top of the edge performance, a PII X4 honestly dosen't FEEL slower than a I7 to the normal man, and even an OCed I7 may just feel somewhat faster (even if it can provide benchies that just owns when OCed) Because look at it this way, if you are a average home user, then the improved multi-media encoding process that i7 excell at won't be needed since it's a once in a blue moon thing, if you are a gamer, then we know that the i7 and what nots are on par or somewhat better, but when everything is running at friggin 100 vs 130 fps, who the hell cares??

So, AMD is going to stay at the current processing power, while going to smaller nodes, and I guess optimize their manufacturing methods to produce CPUs that work just enough (that are not going to compete in the high end) and be extremely cheap, think a sub 150 or less PII X4 and a budget 70 dollar Athlon II X4!!

All this needs one thing tho, public awareness, where Intel kinda have everything locked down with the performance crown and is not playing up the need for a discreet card / far more power IGP.

O and also things like crysis 2 and other heavy demanding games, if they simply can't run on amd (which I HIGHLY doubt) without OCing with the same vid card will cause a panic, but otherwise, AMD's just right thing makes sense, but not enjoyable as someone whom likes high speed.

 

[qurious69ss]

That's a BINGO! holy dude. Now as far as PCIE going away well that is up to the OEMs and MB manufacturers and not up to Intel or Amd per se.

 

[theholylancer]

well with the marking moniker

get a better GPU by buying a better CPU, well you know where this is headed right?


and also, with the GPU bound by the heat from the CPU, I would strongly think that if AMD were to produce a nice 45xx/43xx IGP then it would have to be off die, and that any fusion parts are going to be on par with what intel's got at best or at least not as good as an off die, independent IGP be.

 

[qurious69ss]

well I think what they mean is, good enough performance vs top of the edge performance, a PII X4 honestly dosen't FEEL slower than a I7 to the normal man, and even an OCed I7 may just feel somewhat faster (even if it can provide benchies that just owns when OCed) Because look at it this way, if you are a average home user, then the improved multi-media encoding process that i7 excell at won't be needed since it's a once in a blue moon thing, if you are a gamer, then we know that the i7 and what nots are on par or somewhat better, but when everything is running at friggin 100 vs 130 fps, who the hell cares??

So, AMD is going to stay at the current processing power, while going to smaller nodes, and I guess optimize their manufacturing methods to produce CPUs that work just enough (that are not going to compete in the high end) and be extremely cheap, think a sub 150 or less PII X4 and a budget 70 dollar Athlon II X4!!

All this needs one thing tho, public awareness, where Intel kinda have everything locked down with the performance crown and is not playing up the need for a discreet card / far more power IGP.

O and also things like crysis 2 and other heavy demanding games, if they simply can't run on amd (which I HIGHLY doubt) without OCing with the same vid card will cause a panic, but otherwise, AMD's just right thing makes sense, but not enjoyable as someone whom likes high speed.

So you believe that they are abandoning Moore's Law? That would definitely change everything.

 

[theholylancer]

I would imagine this would apply until software demands more power, either because of bloat or actual need, but I don't see that in the near future with CPUs, more with GPU for games and of course, the professionals that does massive amount of encoding will drive this space, but hey intel got deep r and d pockets and they will most likely put out these parts rather than AMD


and ofc i don't mean that they simply sit EXACTLY still with performance, just that most of the energy is shifted from increasing processing power to increasing ease of production and etc.

 

[qurious69ss]

well with the marking moniker

get a better GPU by buying a better CPU, well you know where this is headed right?


and also, with the GPU bound by the heat from the CPU, I would strongly think that if AMD were to produce a nice 45xx/43xx IGP then it would have to be off die, and that any fusion parts are going to be on par with what intel's got at best or at least not as good as an off die, independent IGP be.

I think we are still quite a few years from giving up discreet gfx. IGP serves its purpose too for business pc and HTPC but I just can't see it in its current form being able to play intense video games. For that market you will have to use discreet for the foreseeable future and if there's a market for this then there will be companies who will cater to that market.

 

[theholylancer]

not replacing discreet gfx, replacing the option to have discreet gfx for OEMs and better IGP for OEMs

discreet cards are far far off of being replaced, but OEMs would have no issue with making people buy whole new computers or limit them to a CPU upgrade to get better performance.

 

[qurious69ss]

I would imagine this would apply until software demands more power, either because of bloat or actual need, but I don't see that in the near future with CPUs, more with GPU for games and of course, the professionals that does massive amount of encoding will drive this space, but hey intel got deep r and d pockets and they will most likely put out these parts rather than AMD


and ofc i don't mean that they simply sit EXACTLY still with performance, just that most of the energy is shifted from increasing processing power to increasing ease of production and etc.

This reminds me of something Bill Gates said in the 80's.

Bill Gates...“640K of memory should be enough for anybody.”

 

[theholylancer]

Yap, which is why they gota balance everything out, and keep up with the minimum of lets say 50fps in a fast game and 30 fps in a slow game and allow for sub 20 minute processing of a full movie in w/e format and res of the day to allow for good enough performance. Right now, the top end and hyper top end/OCed top end is the difference between 100 or 130 fps, and thats on CPU bound games, and not GPU bound games where everyone sits at exactly the same spot with the same GPU, so yeah right now it does look like Gate's comment lol.


Now imagine if Gate's came out every year and simply updated that comment, and hey maybe that wouldn't be as much of a joke as it is now.

 

[qurious69ss]

not replacing discreet gfx, replacing the option to have discreet gfx for OEMs and better IGP for OEMs

discreet cards are far far off of being replaced, but OEMs would have no issue with making people buy whole new computers or limit them to a CPU upgrade to get better performance.

Well call me a pragmatist but if you are able to replace a gfx card then you should have no issue building a rig and have not business buying from an OEM.

 

[theholylancer]

Well, I know many people whom was running IGP and went out and brought a dedicated lower end card, plugged it in and installed the drivers on the CD (or was using vista driver for some time before they asked me) and left it as that and actually gamed, and since the cards they got were from staples and were cards that didn't need a new power plug (no need for new PSU since everything is at least to the spec of PCIE power req).

these guys are obviously guys that games, yet don't spend all that though on high end machine, and just follows some advice piece meal from online or else where that would now other wise be begging other people to build, or save up and sink massive money on "high-end" OEM rigs

 

[sonoran]

With a smaller process, a new fab coming online within 2 years and global buying up everybody else, AMD will basically never need to worry about meeting demand.

There's one flaw in your argument - GF isn't going to be sitting around with tons of extra capacity waiting for orders from AMD to show up. They're going to be busy making chips for other customers too. The capacity they have to dedicate to AMD will be limited. That capacity may (and probably will) exceed today's, but there will always be limits.

Intel is next, and AMD is going to do the same thing again. Of course intel are huge and they can see it out, but they will lose a large chunk of marketshare and probably a lot of profit in the process.

You mean Intel does not have the power to control pricing in the x86 CPU market?

 

[roofus]

not replacing discreet gfx, replacing the option to have discreet gfx for OEMs and better IGP for OEMs

discreet cards are far far off of being replaced, but OEMs would have no issue with making people buy whole new computers or limit them to a CPU upgrade to get better performance.

we have a winner! OEM's will go this route is they can save 50 cents per unit. want a better pc? they will gladly sell you another one.

 

[qurious69ss]

So people like this really exist. I thought it was just a myth. j/k I know what you mean, but I guess I come from a different train of thought. I'm the type of person who if my car breaks down I will fix it or at least know what the problem is before I take it to the shop.

 

[JAYDEEJOHN]

Theres been hints of non IGP chips from AMD down the road, and lessor ones as well.

If theres a mix, for certain things, whether its gaming, average Joe, and business, in that order, per IGP perf, this too could be done.
The IGPs seen in fusion are said to be decent, not earthshaking comapred to discrete, but compared to current IGPs, earth shaking.
Possibly 300-400%, which puts it in that "good enough" category.
If they can get current games to run as fast as they do now, but with higher settings, same fps, people will buy these. It could actually increase the discrete sales down the road.
Rumors are coming ijn, GFs 28nm is close, full production 2H this year, meaning 32 is most likely closer than we think as well, which means these solutions arent far off

 

[roofus]

So people like this really exist. I thought it was just a myth. j/k I know what you mean, but I guess I come from a different train of thought. I'm the type of person who if my car breaks down I will fix it or at least know what the problem is before I take it to the shop.

I think you will find most everyone here in this forum knows a decent amount about computers and of course some have passionate likes/dislikes but none fall into the category of know the problem, research the solution cost, etc. much like yourself. Just have to realize that we are not the target mainstream market. They know their market well and know what drives a purchase. Name recognition, marketing and low cost. Average Joe doesn't know the right questions to ask and suffers later for it.

 

[JAYDEEJOHN]

Id also point out, GF is already alot larger than it was, so having a larger capacity is already there

 

[theholylancer]

when did you get mod jdj lol??

what i wanted to know is 300-500% enough to drive modern games at 1280*1024 / 1024*768, which seems to be the common resolution is for someone that don't seek out the high end yet still game, and it is a very acceptable res for a IGP to be able to push out 60+ fps on relatively modern games and 40+ fps on modern games.

 

[roofus]

Oh and it shouldn't come as a surprise to anyone when AMD does GPU on the CPU package that it will utterly embarrass the Clarksdale. Being first isn't always the best thing.

 

[qurious69ss]

Id also point out, GF is already alot larger than it was, so having a larger capacity is already there

Last I read Fab 36 or Fab 1 is the only one they have up and running. Fab38 is still in conversion to 300mm.

 

[fazers_on_stun]

Who said anything about selling below cost?

You know fine well that intel are selling cpu's to idiots at WAY above cost. AMD can sell chips at much less and make a profit.

With a smaller process, a new fab coming online within 2 years and global buying up everybody else, AMD will basically never need to worry about meeting demand.

Think about what they did to Nvidia. They couldn't win on perception, they couldn't charge the same prices. So they priced Nvidia out of the market instead. You cannot deny it was an absolute masterstroke and perfectly engineered.

Intel is next, and AMD is going to do the same thing again. Of course intel are huge and they can see it out, but they will lose a large chunk of marketshare and probably a lot of profit in the process.

And AMD and nVidia both relied upon TSMC to fab their GPUs, so they were on a level playing field (unless there were some volume or other deals TSMC made with one party to the exclusion of the other). At the moment, Intel and GF are not at the same level - Intel has at least a year's lead over GF, familiarity with HKMG, and is basically leading the industry (e.g., their push to 450mm wafers).

AMD has already tried cutting prices, and I don't see any significant increase in marketshare.

And let's keep the discussion civil, by not referring to 80% of the CPU customers as "idiots", please. 😛 After all, Intel needs to fund their market-leading R&D efforts so that AMD can tag along while denying that they are doing so .

 

[qurious69ss]

Oh and it shouldn't come as a surprise to anyone when AMD does GPU on the CPU package that it will utterly embarrass the Clarksdale. Being first isn't always the best thing.

No it wouldn't surprise me that it will perform better at graphics but what about cpu tasks? BTW, wasn't fusion suppose to of been out last year? When are they releasing it now?

 

[fazers_on_stun]

This reminds me of something Bill Gates said in the 80's.

Bill Gates...“640K of memory should be enough for anybody.”

And he was right - for 1980s people! 😀

 

[JAYDEEJOHN]

So, GF hasnt bought any other fabs?