Your analysis is spot on. But if indeed AMD has limited resources to spend on a new market and lacks the wherewithal to take on Intel in the principal microprocessor market, what kind of future awaits the company five to ten years from now? Perhaps looking that far out may not even be worth it. Who knows whether PCs would still be relevant 10 years from now!
While expanding AMD's product line may sound like a solution to regaining their lost market share, AMD does not have much as much expertise outside of microprocessor or capital to invest in other technology. It used to make flash products but was spun off as a separate company Spansion. The only way that AMD can win is to analyze what market segments they can target. Perhaps they should consider focus more working with open source to target the cloud computing market.
I am sorry but this sounds like a nightmare kind of situation. These two companies have fought to a draw but cannot even declare some a truce and go do other stuff. The situation you described is true: neither Advanced Micro Devices nor Intel can afford to lose a few points of market share without the market tagging them "losers."
AMD is, of course, both better off and worse off in this situation. If it wins additional market share from Intel that would be good for its business -- but it would also tick off Intel even more, which could mean a long price war. On the other hand, if it loses any more market share, it might as well give up. Intel, meanwhile, cannot really afford to gain more market share for fear of being condemned and accused of being a monopoly. If it also loses market share, it stands the risk of being seen as "lead-footed".
I have a solution for these two companies. They need to broaden out into other markets. Enough of the processor war. Let's see how well they can play in other segments of the semiconductor market.
AMD has always had to struggle not to fall too far behind Intel in the technology [and manufacturing] race. It partially got rid of the manufacturing problem by spinning off GlobalFoundries. Now it must stay close to its rival in the technology area. The company has in the past managed to even surpass Intel with some cutting edge products but because of its big pockets, Intel has always easily caught up with AMD.
It would be wrong, still, to think Intel is never under pressure. Everyone expects the Intel juggernaut to win all the time so it can be pretty shocking and embarrassing for Intel when it trips up and David ends up thumping Goliath!
Maybe the advent of uIP could change once again market share picture in the near future; sensor networks especially to support green and healthcare applications are in deployment and few innovative operating systems to embed IP and microRF services are in trial.
I am curious what is the margin of error? The problem for AMD might be larger. On the other hand AMD products are always cheaper than equivalent ones from Intel. Yes, in some case they cannot use the same software code, but still it is a bargain.
Excellent point, Bolaji. The MPU market is so big but so closely held by the two majors--AMD and Intel--that the slightest tremor can trigger a tsunami. From the consumer standpoint, the AMD vs Intel battle may not mean much--although the "Intel Inside" campaign is a brilliant strategy. It's the components and software that are behind the MPU that make the difference. So definitely, that 1% has much bigger implications than many in the market might think.
The MPU market looks simple and plain. But this may not be the same after 2 quarterd from now. AMD will be coming out with big plans with the fusion to actually get into the designs of many OEM's as possible. It is really important for the OEM's to actually have AMD beside Intel to make any price negotiation with Intel. But at the same time Intel is heavily investing in the ATOM series and the recently launched sandy bridge processors.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.