Intel reportedly reserved $ 3 billion in 2019 to competitively block AMD

DooKey said:
Silly article. Offering discounts to sell processors because the competition has a better deal is just business.
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So, anti competitive practices are competition? Sure thing dude, sure thing. Next thing you tell me is it is competition if Intel only offers those discounts if the OEM does not sell the competition, eh?
 
Had it not been for AMD64 way back when, Intel probably would have gone the easy route and pulled their x86 license 20 years ago.
 
Seriously, just exactly how much price gouging have they been getting away with till now. Do they realize that's the other side of the coin?
 
DrLobotomy said:
Somebody must have gotten fired for buying intel.
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People should. The actual use cases for Intel in the industrial/datacenter side of things are very niche at this point when considering TCO, space, cost, functionality, capability etc. AMD has simply outclassed Intel in every common metric that matters - practically all roads lead to Rome.
 
N4CR said:
People should. The actual use cases for Intel in the industrial/datacenter side of things are very niche at this point when considering TCO, space, cost, functionality, capability etc. AMD has simply outclassed Intel in every common metric that matters - practically all roads lead to Rome.
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Except when it comes to supply. AMD is supply constrained.
 
N4CR said:
People should. The actual use cases for Intel in the industrial/datacenter side of things are very niche at this point when considering TCO, space, cost, functionality, capability etc. AMD has simply outclassed Intel in every common metric that matters - practically all roads lead to Rome.
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Im not switching to amd because of the incompatibility, we’d have to replace multiple racks of equipment to keep EVC in our vmware cluster. Not worth the over time cost savings on equipment when theres too much up front for us.
 
So Intel plans to take a 3 Billion Dollar lost as 2019 is almost in the books = EPYC Fail for the Win
 
westrock2000 said:
Had it not been for AMD64 way back when, Intel probably would have gone the easy route and pulled their x86 license 20 years ago.
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I believe AMD owns the x86 Super Set license also and on die north bridge controller = Intel's Core 2 design mimic AMD's memory controller patent on Venice Core .. AMD has done more for cpu design then Intel has ,, they are more like the China = Copy and Paste = Intel
 
N4CR said:
People should. The actual use cases for Intel in the industrial/datacenter side of things are very niche at this point when considering TCO, space, cost, functionality, capability etc. AMD has simply outclassed Intel in every common metric that matters - practically all roads lead to Rome.
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You don't quite understand the datacenter business.

1. Migration is non-trivial for many workloads, since most things are virtualized - Unless you're willing to totally cap your current investment and start new environments that are 100% AMD, you end up with silos of resources, since AMD wasn't competing until recently. For new projects we'll gradually see AMD picking up steam, and if you have a major refresh the 1-2 minute downtime for switchover can be managed (assuming shared storage between clusters), but expanding existing environments is 95% same-vendor so you can just expand. This is especially true now that HCI has taken off, since most of that storage is in-cluster only.

2. Complete architecture changes are scary. Business hates risk. It takes time for that ship to turn.

3. LOTS of appliance-like systems are tied to Intel and haven't built AMD versions yet. This takes time as the vendor has to determine that there's enough demand before they'll invest in a new version of the appliance (see: Nutanix, VxRail, EMR systems sold as black boxes), and the demand is low because the focus is FIRST on business outcomes, not on "what hardware is in the box" - either CPU delivers the same business outcome, it's just details of how you get there (which do eventually nudge things around), and SECOND on cost/benefit analysis (unless there's demand, no reason to build a new one)

4. From the customer side, for item 3, if you can't buy it, it's hard to show demand. Making 3 even harder.

These things take time. It's happening, there's interest in Rome around the datacenter world I live in, but big business doesn't swing on technology as much as it swings on outcome, and this is a relatively minor driver of outcome. Small customers start first; migrations are easier, downtime is easier to manage, and there are definitive cost savings in single-socket Rome over dual-socket Intel in licensing, but those same drivers slow things down on the enterprise side (licensing isn't a concern with an ELA, downtime can't be easily managed, outcomes drive investment).

So, in summary: Yes, they care. Are they doing anything about it? Sure, slowly, but not in any huge rush. It's an X86 CPU at the end of the day, and that doesn't change ~enough~ to be the primary driver of purchasing decisions.

Disclaimer: I work for one of the largest data center companies in the world.
 
ManofGod said:
So, anti competitive practices are competition? Sure thing dude, sure thing. Next thing you tell me is it is competition if Intel only offers those discounts if the OEM does not sell the competition, eh?
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I don't think this is anti-competitive. Intel used to keep huge margins on their sales on the contrary of AMD. And still now. So Intel is just lowering his margins. They don't lose money and have made little investment iin the technology and volume of their actual production. I hope they don't get stuck at 14nm level and keep their unsatisfied demand and those high prices only to keep those margins. My bet is they are moving into the 7nm EUV in a big way, but nothing official yet. As of today, Intel will start small production of 7nm EUV when AMD would have already dlivered deliver massive 6nm production (aka 2nd level of TSMC EUV chips) of Zen 4 chips. I can't believe Intel will let this happen or they are dead, losing 100% of the market for 2 years. If so the gap in performance in favor of AMD will be much wider than it used to be between Intel Core and AMD FX line.
 
Spartacus09 said:
Im not switching to amd because of the incompatibility, we’d have to replace multiple racks of equipment to keep EVC in our vmware cluster. Not worth the over time cost savings on equipment when theres too much up front for us.
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I agree. If Intel is close to AMD in performance for an acceptable higher price, it is not worth the fuss to test new hardware and cope with incompatibilities. Also AMD has not yet the powerfull services of maintenance and support that Intel has. Not even close. You're on your own with AMD.
However some computer oriented for compute or a server that works all on its own and is made by some Computer company like HP, Cray, Dell or IBM may very well use AMD CPUs as long as those companies provide the full support.
 
ManofGod said:
Intel does what Intel does when they cannot truly compete.
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The AMD AM4 standard Desktop platform now beats the top level HEDT CPU by 25% (3950X vs 10980XE). Intel is now in very difficult position.
If ever AMD starts selling its 3950X next year at 300$, when Zen 3 4950 comes out using 7nm EUV with 4 threads per core, Intel will need to drop their 10980XE at 200$. This is a 10 times drop in price from the today 9980XE which is quite the same CPU renamed. This is probably unbearable for Intel. I can't see how Intel can maintain his sales without completely rethink all their line, redrawing new chips and using 7nm EUV from 2020 on. If they don't they'll go bankrupt in no time and AMD will replace Intel in its position by the end of 2020. There is no other issue to all this trouble where Intel put itself in by not investing for years and pocket every penny from their profit.
So not only Intel must invest but they also need to drop their prices lower than AMD. This will bring a situation when in 2020 Intel will lose huge amounts of money just to provide the hardware they are ought to by multiple contracts. HP or Dell have exclusive contracts with Intel for hardware. If it is not competitive they will renounce to those contracts to move to AMD, or those companies will lose their position.
If your server or workstation cost 2 times less and is 2 times more powerful, this brings a huge advantage against competitions. HP, Dell won't let this happen only to stay with Intel.
 
thesmokingman said:
Are you justifying it? I don't get what you're point is with a comment like that?
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Pretty sure he meant when you're one of the biggest chip manufacturers in the world and are worth triple digit billion dollars you can do what you want and it not change the bottom line.
 
Spartacus09 said:
Pretty sure he meant when you're one of the biggest chip manufacturers in the world and are worth triple digit billion dollars you can do what you want and it not change the bottom line.
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That's not what I got from that. And you cannot do whatever you want just cuz you have billions. Unless you guys think those suits that they lost were unfair or something?
 
thesmokingman said:
That's not what I got from that. And you cannot do whatever you want just cuz you have billions. Unless you guys think those suits that they lost were unfair or something?
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They were completely fair, It just means that the settlements and fines were so low compared to their revenue and company value that they barely even noticed. Likely board footnote: “Above average legal fees this year”

I mean, within reason, if you have billions of dollars yeah you kinda can do whatever you want, As an individual or corporation.
 
Spartacus09 said:
They were completely fair, It just means that the settlements and fines were so low compared to their revenue and company value that they barely even noticed. Likely board footnote: “Above average legal fees this year”

I mean, within reason, if you have billions of dollars yeah you kinda can do whatever you want, As an individual or corporation.
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I think you're ignoring the illegal anti-competitive nature of it. They were fined billions, yet to pay some of the fees back still today. The real crux of their gain is that they buried AMD for a decade. Not sure you get that last part?
 
ManofGod said:
So, anti competitive practices are competition? Sure thing dude, sure thing. Next thing you tell me is it is competition if Intel only offers those discounts if the OEM does not sell the competition, eh?
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Pepsi does it to Coke, Taco Bell to Jack in the Box, Costco to Walmart.

It’s called incentive, not barring a brand entirely.
 
westrock2000 said:
Had it not been for AMD64 way back when, Intel probably would have gone the easy route and pulled their x86 license 20 years ago.
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Intel will NEVER pull AMD's license. They will have anti-trust letigation from the government in a heartbeat if they did. They need AMD to survive. They just want them to be an insignificant player.

DooKey said:
Who can supply more data center processors? I'll hang up and wait.
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Intel is constrained. I work for a company that has bought Dell poweredge forever. For the first time though, they are actively pushing AMD. Why? Because they are having to charge more for Intel due to 14nm shortages. They'd rather more easily push readily available AMD and be able to delivery product and charge for it.


Jandor said:
The AMD AM4 standard Desktop platform now beats the top level HEDT CPU by 25% (3950X vs 10980XE). Intel is now in very difficult position.
If ever AMD starts selling its 3950X next year at 300$, when Zen 3 4950 comes out using 7nm EUV with 4 threads per core, Intel will need to drop their 10980XE at 200$. This is a 10 times drop in price from the today 9980XE which is quite the same CPU renamed. This is probably unbearable for Intel. I can't see how Intel can maintain his sales without completely rethink all their line, redrawing new chips and using 7nm EUV from 2020 on. If they don't they'll go bankrupt in no time and AMD will replace Intel in its position by the end of 2020. There is no other issue to all this trouble where Intel put itself in by not investing for years and pocket every penny from their profit.
So not only Intel must invest but they also need to drop their prices lower than AMD. This will bring a situation when in 2020 Intel will lose huge amounts of money just to provide the hardware they are ought to by multiple contracts. HP or Dell have exclusive contracts with Intel for hardware. If it is not competitive they will renounce to those contracts to move to AMD, or those companies will lose their position.
If your server or workstation cost 2 times less and is 2 times more powerful, this brings a huge advantage against competitions. HP, Dell won't let this happen only to stay with Intel.
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You are being VERY optimistic with pricng. AMD charges as much as they think they possibly can. I remember vividly paying $600 for my dual core Athlon X2 back in the day and that was a price drop from $1000. The 3950x won't be a dollar cheaper than the 9900K.
 
OFaceSIG said:
You are being VERY optimistic with pricng. AMD charges as much as they think they possibly can. I remember vividly paying $600 for my dual core Athlon X2 back in the day and that was a price drop from $1000. The 3950x won't be a dollar cheaper than the 9900K.
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That's not true. They have priced very low and its something they cannot continue to do as it kills profits long term. They will have to price higher or it will hurt them long term and piss off investors. If you own their stock, you'd know their gross margins are ridiculously low. And at some point they will have to recover that R&D expenditure. AMD are operating at 40% margin whereas Intel is at 70%. 70% freaking percent! Let me also state the obvious, that AMD are priced low to recapture market share and change consumer perception of their product. But that is unsustainable long term.

https://articles2.marketrealist.com...-have-different-approaches-to-managing-costs/
 
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OFaceSIG said:
Intel is constrained. I work for a company that has bought Dell poweredge forever. For the first time though, they are actively pushing AMD. Why? Because they are having to charge more for Intel due to 14nm shortages. They'd rather more easily push readily available AMD and be able to delivery product and charge for it.
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My point about AMD being supply constrained is that even if Intel totally blows their 7nm process, is that AMD being fabless, still won't be able to take up the slack. They are probably stuck at around 25-30% (wild guess) of the server market until they make enough money to buy capacity that bigger players are using at TSMC. However, Intel is indeed constrained at 14nm.

Not sure why everyone thinks I was slamming AMD. More power to them as far as I'm concerned.
 
DooKey said:
My point about AMD being supply constrained is that even if Intel totally blows their 7nm process, is that AMD being fabless, still won't be able to take up the slack. They are probably stuck at around 25-30% (wild guess) of the server market until they make enough money to buy capacity that bigger players are using at TSMC. However, Intel is indeed constrained at 14nm.

Not sure why everyone thinks I was slamming AMD. More power to them as far as I'm concerned.
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You're guessing which is not based on fact. Intel has been constrained for god knows how long... they're still constrained lol. They said 3rd quarter would be better but no, the reality is it will continue for a few more quarters. Also, being FABLESS is what has kept AMD from sinking and imploding into the mess that Intel finds itself in. The interesting part is that no one knows why...

Steve Brazier, CEO at Canalys, said the "short answer is that we don't know [what is causing Intel's shortages]. And they are not telling anybody, so nobody completely knows why. All we can do is speculate that they made a serious software design flaw."
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https://www.theregister.co.uk/2019/10/18/intel/
 
thesmokingman said:
That's not true. They have priced very low and its something they cannot continue to do as it kills profits long term. They will have to price higher or it will hurt them long term and piss off investors. If you own their stock, you'd know their gross margins are ridiculously low. And at some point they will have to recover that R&D expenditure. AMD are operating at 40% margin whereas Intel is at 70%. 70% freaking percent! Let me also state the obvious, that AMD are priced low to recapture market share and change consumer perception of their product. But that is unsustainable long term.

https://articles2.marketrealist.com...-have-different-approaches-to-managing-costs/
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That's my own point! AMD will charge more as time allows. Their margins now are much higher than they were with bulldozer and piledriver. With time, as they better their position they WILL charge more. They have done it in the past, it will happen again.
 
^^The amount of victim blaming here is ridonkulous. And so is the lack of facts.
 
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OFaceSIG said:
That's my own point! AMD will charge more as time allows. Their margins now are much higher than they were with bulldozer and piledriver. With time, as they better their position they WILL charge more. They have done it in the past, it will happen again.
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At least they will have options at various price points instead of Locked SKUs and OC SKUs.
 
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