6.13.2006

Rumor Mill: ATi + AMD Does it make sense?


You might ask where I've been lately, and believe me when I say that I've been insanely busy. First with Voodoo things are, shall we say, nuts. We are working to launch a new product line in the very near future. CPU Magazine requested that I write a monthly column, which means I will probably link to each and every column from my blog - but it also means that my time is getting thin. I also rode with Team Voodoo at the ride for MS this weekend (just a small group of us). We managed to raise some good money for MS research - it was a very well organized event. I'd like to thank all the people who sponsored me for this ride, it won't go unnoticed.

As many readers of my blog have witnessed I have been suggesting that there may be consolodation in the semiconductor space, and I have also said that ATi is a likely candidate for takeover. In my opinion ATi is a jewel that needs some polishing to make it into an amazing company. I, like all of you, have read the rumors - and I do have an opinion on the potential of AMD and ATi coming together and I will share my opinion in the upcoming issue of CPU Magazine. It's going to be a doozy.

In the meantime people have been questioning whether or not I've "switched camps" - and I think you need to realize that I was never in one particular camp. Voodoo has always supported the best technology, that is why up until now we sell 100% AMD on the desktop and workstation, and about 50/50 AMD to Intel on notebooks. People can't expect Intel to remain in this position forever and as such we have been eagerly awaiting the launch of Conroe. I have been testing it, and as I said before it's *!%#ing fast. I honestly believe Intel Conroe is going to revive our industry and kick things into high gear.

I still believe Conroe will be a challenge for Intel to produce in volume so I am a firm believer that Intel will not wage a price war unless they are forced to. It's hard to wage a war when you don't have enough ammunition. ..and to be perfectly honest, Intel may be able to demand a premium for Conroe Extreme so why bother discounting it?

Regarding AMD in Dell, I don't believe AMD will allow Dell to cherry pick only the top end Opteron for their portfolio. It is my belief that Dell will launch more AMD, including Turion and Athlon 64 in the near future. I just checked AMD's stock price - it seems like a killer opportunity to get in at the level that everyone was wishing they got in at before. Intel at $15-$16 looks pretty sweet too!

So that's it for my random babble, I'll be back soon - and be sure to check out the next edition of CPU - it should be interesting.



43 comments:

Sharikou, Ph. D said...

I analysed the DELL-AMD situation here. Basically, because of Intel's pricing crash, DELL will have go AMD64. AMD's market share will keep rising.

Intel is financially very fragile right now. 3Q06 and 4Q06 will be Intel's most vulnerable time due to the Netbust - CORE2 transition. If AMD can succeed in denying Intel the oppurtunity to unload its legacy inventory at a good price, Intel will spiral down for the next 7 quarters. Just as Intel ramps CORE2 to 35% in 1Q07, AMD's 65nm Rev G floods the market, then Rev H cluster frag comes in 2Q07. Intel will be set back by another 3 years minimum. The K8L is mind boggling stuff. Intel has zero chance to withstand the K8L frag.

By the end of 2007, AMD will have enough capacity to supply over 70% of world's CPU needs. By the end of 2008, AMD will be able to supply close to 100%.

Sharikou, Ph. D said...

Intel's 4Q05 revenue was $10.2b, 1Q06 was $8.9 (with a lot of channel stuffing), 2Q06 is expected to be $7.8b (Joe Osha). Intel's free cash flow is reaching for 0 during 1Q06, and it will definitely be negative for 2Q06. I project that Intel will see operating losses from 3Q06 onward. GAAP loss for 2Q06 is also a possibility due to impairment of goodwill and other charges. Once Intel is in red. Its stock will be traded at about $12, 2x book value. However, if Intel write off some assets, the bookvalue will be lower, and a stock value of $9 is possible.

TheKhalif said...

I wiil definitely look for the article. I for one dont' blieve this will happen. AMD doesnt want to fragment their chipset suppliers. That may take them back to the VIA days because they woul dalso have to decide how to mass-produce ATi chipsets and video cards. Of Course they have operated in the red before but now is not a good time to try and readjust their entire supply line.

Anonymous said...

Simple math for dummies:
Intel is at least 5 times the size of AMD. I.E AMD is 20% (or even less) the size of Intel. 20% of Intel product mix as some people claim will be Conroe. That means that Intel will put at least 1 Conroe for each AMD offering. SO Intel's 20% is actually AMD's 100% capacity.
With the perfromance lead that Conroe has, why would anybody buy an Athlon? It looks like AMD has to either drop their prices significantly on the Athlons which eats up their bottom line, or they have to pull a rabit out of the hat. The AM2 was not a bull, it was a chicken. Just read AMD's statements, they are talking about brand new core for their mobile! SO the rabit thing is out of the question. If you are an AMD investor, face it, their stock is going one way and that is not up. If you are Sharikou, then you are stuck in groundhog day!

whorush said...

"Intel is at least 5 times the size of AMD. I.E AMD is 20% (or even less) the size of Intel. 20% of Intel product mix as some people claim will be Conroe. That means that Intel will put at least 1 Conroe for each AMD offering. SO Intel's 20% is actually AMD's 100% capacity."

uhhhh "simple math for dummies." %20 of %80 is actually 16. not more than 20. and i think amd has %22.4? or something?

i think 4x4 is a big deal. even if conroe is a bit faster, get 2 3800 X2s for around 300 after the price cuts and there's no contest. that is if you know what to do with 4 cores! i for one would have no idea, except for lots of "folding at home."
folding.stanford.edu/

Anonymous said...

whorush said... "i think 4x4 is a big deal. even if conroe is a bit faster, get 2 3800 X2s for around 300 after the price cuts and there's no contest. that is if you know what to do with 4 cores! i for one would have no idea, except for lots of "folding at home."".. NOW Re-think again....

Refer to the "4x4" diagram... One of the processors requires TWO HT links!!! All run-of-the-mill (budget) desktop AMD processors have only ONE HT link. How do you connect 2 processors and have another HT link to the PCI/PCIe bridge?

Only the Opterons are suitable for 4x4 system because they have 3 HT links... Did you know that? That's why these are use in 2P and 4P systems, and NOT athlons.

Doubling processors DOES NOT DOUBLE FPS, in fact the improvement is very slight only (for example in dual processors are in order of +5% to +20%, sometimes less about -5% to -20%, still which also depends on software coding of games and applications, besides the drivers) because a large part of it is GPU-bound. I rather go for a spanking powerful GPU INSTEAD of spending on two or four (expensive) processors BECAUSE at least I know that I'm guranteed to get more FPS.

BTW, we common geeks are not rich-enough to spend that kind of sum (on 2 or more processors) just to squeeze a paltry extra few FPS. We rather spend on more powerful graphics card. We mostly thrive in the 1 processor system... LOL

Surya said...

If Conroe is what Intel and Rahul claim to be, I think Sharikou your ideas are going to be busted about AMD rocking. Conroe comes out and I think Intel will win this round.

Sharikou, Ph. D said...


Conroe is a stopgap solution, AMD 4x4 is a permanent solution
.

AMD's price cut and effect on Intel is analysed here.

Intel will definitely see operating losses in 3Q06 and 4Q06. Intel will lose market share (DELL and everyone else is increasing their AMD portfolio), coupled with lower prices, means red for Intel.

AMD can lower ASP by 15%, however, its capacity will almost double by the end of 2006. This will more than compensate the ASP drop.

Anonymous said...

"4x4"=marketing BS. Plain and simple, for majority of (normal) gamers, rather upgrade better GPU than getting and (expensive) "4x4" system. And by the time "4x4" starts showing up... then other newer, faster/better, power efficient and *cheaper* solutions will appear (technology is always accelerating)... If you want a "4x4" system now, its in FACT already AVAILABLE as a dual socket server board with dual PCIe (for SLI or XFire) for Opterons! That's why "4x4" equals BS.

Economy of late.. Lower prices means more buyers, means more market share (and more takers and penetration, just like AMD in ye olde times). Ask the average Joe (price also matters, its not always about technology)..

Dell's AMD deal is for the server segment only at the moment. As for desktop machines, the "Pentium" brand is still going strong among most (ordinary) people which forms Dell's biggest customer base (both business, home and consumer). And with proposed price cuts on Pentiums this will promote more sales of their PCs due to cheaper price (or better bargain, whichever way people sees it).

If AMD lowers its prices as well in retaliation, this would hurt their profits a lot as AMD already have problems with debt, production and supply issues. Meanwhile in Q3 and Q4, AMD processors aren't gonna be very cheap (they cannot lower their prices too much) because most will be coming from Chartered's FAB intead of AMD's own FAB (AMD has to pay Chartered as well! If AMD starts using different prices for chips from different FABs, then that would be pricing chaos.. wouldn't it? Did you take that into account?).

Intel is much bigger than AMD and has been able to sustain itself despite those 3 years of "pwned by AMD" (as fanboys put it), THUS I don't see why it can't sustain itself for the next few quarters even with this price war looming.. Price wars will hurt both companies. Lower prices won't hurt Intel much BUT it will hurt AMD more.

"Can"? "Will"? "Double"? Even if AMD did get started (and implemented) 65nm process by end of 2006, first yields will be bad (and as Rahul puts it, 65nm yields are much lower). And that's only a single fab (versus Intel's own already running 2, 3 and 4 fabs?). Economy of scale comes into play here... That's why AMD hired Chartered is to fulfil capacity, HOWEVER these are 90nm parts only.

Analyze that...

Anonymous said...

Sharikou, you are a clown and certainly no PhD. Unless your definition is "Pig Headed Dumbass" :D

Anonymous said...

Intel will rule post Q3 2006 after a series of mega product launches like Conroe and Merom. They have a good product line coming when compared to AMD's.

Anonymous said...

Real apps (32/64-bit):

E6700 2.66GHz 4M =< AM2 A64 X2 (Rev G, 65nm, 1-2M) à x.x GHz ?
E6600 2.40GHz 4M =< AM2 A64 X2 (Rev G, 65nm, 1-2M) à x.x GHz ?

E6400 2.13GHz 2M =< AM2 A64 X2 (Rev G, 65nm, 1-2M) à x.x GHz ?
E6300 1.86GHz 2M =< AM2 A64 X2 (Rev G, 65nm, 1-2M) à x.x GHz ?


Intel profit warning again ?

RotoSequence said...

Your analysis makes no sense Sharikou. This world isnt going multicore as fast as it can, and two more cores on top of another already essentially un-used processor wont do anything to compensate for Conroe's performance benefits. Once multicore gaming comes out, it will still only really be dual core; Intel can just slap another Conroe die on next to it and call it good. 4x4 wont do didley for me.

Anonymous said...

Anonymous said... "Real apps (32/64-bit):...." and blah blah.. Talk is easy (just like AMD's marketing BS). Show some proof first (AT LEAST) of a working 65nm Rev. G processor (running benchmarks and Windows/Linux). Still not even any (65nm) engineering sample exist (in the wild) either.

"Intel profit warning again ?" Sounds like sharikou Permanent Head Damaged words here... LOL

Anonymous said...

""Intel profit warning again ?" Sounds like sharikou Permanent Head Damaged words here... LOL"

Why wouldn't there be a profit warning? You think P4&PD is hot sell? If they can't get rid of those chips, they are in hot water for the next quarters.

Anonymous said...

"Why wouldn't there be a profit warning? You think P4&PD is hot sell? If they can't get rid of those chips, they are in hot water for the next quarters.".. Ever questioned the following..

1. Despite "Intel being PWNED those 3 years by AMD", did Intel fold? What's holding them afloat all those years? Answer is big OEMs such as Dell, HP/Compaq, Acer, etc. For example, just one browse thru Dell's catalog Intel territory there.. Don't forget about their mobile processor market! Intel still has BIG volume here, while AMD don't.

2. When those prices come down, those Pentium-4 and Pentium D will kill the market for (Intel's own) Celerons, Semprons and even single/dual core AMD64. Even it ain't sellin' well, AMD will be forced to bring down their prices as well, which means lower profits (profit warning ahead for AMD!). How much can AMD reduce without having loses to cope? How can AMD recoup? Intel can write off those chips easily (at 60% reduction) because they have volume AND a new generation waiting to be launched. BUT do you think AMD is gonna be able to do the same?

3. Do you think most PC enthusiasts are "blind"? If any dual core Pentium D sells lower than cheapest AMD dual core, its a real bargain. The Pentium D 805 is new overclocking king, great for budgeteers! Pentium D 930 is also becoming a favorite among overclockers and budget gamers. Any 4GHz Pentium D can blow away the cheapest AMD X2 (and can keep up with an FX), as more and more PC peeps found out. Anyway, the brand "Pentium" is still going strong (among most ordinary consumers, I guess Intel did rub in a bit of pentium into everyone back then with their advertising)...

Did you see the recent news about AMD reducing its processor cache from 1MB to 512KB? This tells us that AMD has production capacity issues and that they are trying to increase their production (with their current 90nm by reducing die sizes per wafer). Tha reduced-to-half-cache gonna have some impact on consumers ("view" and/or spending decision) as well (and probably a bit of performance hit?).

Do you think there are no takers for Intel's chips? Think again... What say you?

JOhn said...

"Why wouldn't there be a profit warning? You think P4&PD is hot sell? If they can't get rid of those chips, they are in hot water for the next quarters."
i agree intel will definately release profit warning. however, compare to AMD, Intel's profit is still way too large. In addition, I believe NGMA's presence is going to gain Intel back some market share. I think the market will be settled at Intel 80% vs. 20% AMD.

Anonymous said...

The fastest-growing segment of the notebook market, which was the fastest growing segment of the PC market, was for machines with AMD processors, Marengi said.
(Joseph Marengi, senior vice president of Dell's Americas business)
http://www.iht.com/articles/2006/06/14/business/dell.php

Anonymous said...

Personal attacks are the hallmark of a limited and closed mind. That is all I have to say.

Anonymous said...

what a sad bunch of people attacking sharikou, how low can you go? Everybody his opinion, but please keep it personal not on somebodies else's head.

Anonymous said...

"what a sad bunch of people attacking sharikou, how low can you go? Everybody his opinion, but please keep it personal not on somebodies else's head."

Did not know you you the sensitive type Sharikou!

Anonymous said...

What do you call a ph.D. that isn't a real one?

Anonymous said...

"close minded", huh..

Have you seen these articles by the self proclaimed Duck? It doesn't get more closed minded than that.

Anonymous said...

"what a sad bunch of people attacking sharikou, how low can you go?"
Not lower than a guy who calls himself a Doc to sound more intelligent when everybody knows he has no substance.

Anonymous said...

Did we hurt your feelings Shakira?

We're soooooooory..

Anonymous said...

4x4 may just seem like a marketing ploy, but if AMD's rabbit is a co-processor that is designed to accelerate graphics and multimedia, and is fairly inexpensive.
(sub 500$) then that just might be a very big rabbit.

The reason co-processors are so expensive is that the demand for them is so small that the companies making them have to charge an arm and a leg to make a profit. With 4x4 there will be a new market opened up for co-processors that will have ring-0 access, access to ram...etc....etc. Basically you would have on board pacifica that could take over specific tasks within an application.

Anonymous said...

Conroe my not be for everyone, I here Mysterious crashes are the order of the day!!

Anonymous said...

It makes more sense now that the DX10 spec is out and only supported in vista,
I can see a M$-AMD-ATI alliance

Anonymous said...

Oh yeah.. one thingame into mind.. by scrapping the 1MB line (in favor of 512KB), then there will be limited supply for FXs and Opterons. Which means prices for these processors will be rather high. This is gonna be interesting, especially on the outcome of the server/workstation market which Opteron recently made some inroads. Looks like this will give Intel some room to "manouvre"... What say you?

Anyway.. Are we gonna see 512KB cache Opterons and FXs also? Hmm....

Anonymous said...

I'm surprised all the *ntel clowns took the time to pull their hands (and their heads) out of their own *ss long enough to post anything.

They obviously can't read enough to realize that AMD performance is good enough to match conroe on the CURRENT rev (E), given high enough quality RAM, never mind the upcoming revs.

Serious enthusiasts know how important memory is as it is, and when all the hardware sites (that aren't *ntel *ss puppets) demonstrate this, there will be no need for AMD to cut their prices pre-emptively, as some here have suggested.

RotoSequence said...

The reason for the AMD pullout of 1 megabyte L2 cache Athlon 64s is three fold. Production issues (the die size occupied by a 1 meg cache is HUGE for AMD), clean up the product lines (the differences between the 3200+ and 3500+ are...?), and to increase the amount of Opterons they can produce. By cutting the cache to 512 kilobytes, which wont really hurt Athlon 64s as their bus is huge and incredibly hard to fill, they can increase yields dramatically. Increased yields mean lower prices for these parts, and suddenly, more production space is freed up for higher end products - namely, Opterons, the demand for which is going through the roof. Conroe is scaling up fairly slowly, but they are going to be a high demand product that will sell VERY well. Their prediction on volume shipments has more to do with the number of old stock theyre deposing of than poor yields on Conroe; besides, Pentium 4 based products are still well known and will still sell well. Lets face it; consumers are going to be more familiar with "Intel Pentium 4" than "AMD Athlon 64," and the Halo effect will more than likely come into play with the Core 2 Architecture. Intel also only has a few 65nm fabs to play with. The Pentium D will still make a significant amount of shipment due to its 90nm production needs rather than the 65nm needs of Conroe - and besides that, the demand for them is high. They overclock great for enthusiasts, they are great multitaskers for those on a tighter budget, and they still carry the Pentium moniker, which still means something to people.

I think we no longer need to peg Shirokou for his comments. He can make his own analysis, flawed or not, and express it if he wants. Personal attacks arent needed anyone. Also, give the engineers the respect they deserve. Stop trolling.

Anonymous said...

"They obviously can't read enough to realize that AMD performance is good enough to match conroe on the CURRENT rev (E), given high enough quality RAM, never mind the upcoming revs.

Serious enthusiasts know how important memory is as it is, and when all the hardware sites (that aren't *ntel *ss puppets) demonstrate this, there will be no need for AMD to cut their prices pre-emptively, as some here have suggested." - Blanket statement here...

Didn't you do your homework? AMD's transition to DDR2 didn't give them any significant performance advantage due to limit of K8 architecture. And DDR2-based AM2 LOST to lower clocked Conroe even when using faster DDR2-800 RAM (while Conroe uses DDR2-667). Memory ain't important here, in perspective when comparing both processors.. Instruction efficiency, latencies, cache speeds and other stuff comes into play...

Conclusion is - even with better memory, AMD is not good enough to match Conroe! Anyway high performance memory are more expensive.. There goes AMD's price per performance ratio...

By the way, Conroe stepping 5 is out in the wild (showing also better performance than ever, and also better overclockability [on air] as well) and probably will be as close as the retail version. Shops are now starting to show Conroes in their catalogs! Probably preparing for July launch?

Now.. If we are *ntel *ss puppets.. then that makes you AMD's *ss puppets, ain't it? LOL

Anonymous said...

"Did you see the recent news about AMD reducing its processor cache from 1MB to 512KB? This tells us that AMD has production capacity issues and that they are trying to increase their production (with their current 90nm by reducing die sizes per wafer)."

Production problems? Perhaps they are trying to maximize the number of units that can be shipped out the door by halving cache. Perhaps at the request a large OEM.
Maybe Dell...

Anonymous said...

"Did you see the recent news about AMD reducing its processor cache from 1MB to 512KB"

Perhaps this is the cideralla effect -reduced L2 cache New L3 2x4M z-ram cache 'rev G'

Anonymous said...

one more week before launch of Woodcrest.. I can feel AMD sweating!! Lets watch the stock price for the next few months

Anonymous said...

When should we expect the new voodoo lineup that you are working on to be avail?

Anonymous said...

Anonymous said..."Conroe my not be for everyone, I here Mysterious crashes are the order of the day!!" <-- Mystery anonymous sharikou at work here?

Effects of scrapping one of the 1MB cache production lines?

AM2 and Opteron supply will be limited. AM2 uses DD2 thus have different die, that means TWO different prodution lines are required. One for AM2 socket 940(and Opteron socket F?) and the other for Opteron/FX socket 939.

Didn't notice there are more Intel boards than AMDs at the recent Computex?

Anonymous said...

Intel's desktop quad core codename "Kentsfield" in the wild!!

Check out http://www.xtremesystems.org/forums/showthread.php?p=1527913

Methinks its an engineering sample, and sources say there are quite a number of these out there..

Anonymous said...

The practice of running anti-competitor websites seems to be on the rise.

SanDisk has this one called idont.com where they keep criticizing Apple, there are other websites like anythingbutipod.com (I hear its from Creative), sharikou.blogspot.com from AMD (this site has a guy calling himself a phd again and again just to gain credibility), etc.

Its sad that people are willing to falsify benchmark numbers, and look for any excuse to criticize their competitors (citing wrong numbers), just to sell their products.

Anonymous said...

Anonymous said..."Conroe my not be for everyone, I here Mysterious crashes are the order of the day!!" <-- Mystery anonymous sharikou at work here?

no. Paul here, thats what my Taiwan friends say, trying to run 64bit??

Anonymous said...

Looks like AMD is giving up (their traditional stronghold) the value segment according to http://www.dailytech.com/article.aspx?newsid=2966 which quotes "In what is turning into a graveyard of discontinued AMD processors, it has come to DailyTech's attention that a single-core Athlon 64 3000+ and 3200+ Socket 939 processors are getting the axe."

And http://www.hkepc.com/bbs/itnews.php?tid=614776&starttime=0&endtime=0 which quotes "The price drop is just partly agreed with main board manufacturers. Price drop of dual core is able to against Pentium D, but the most disappointed is those low level models such as Sempron and some Athlon 64. As AMD showed no way to win the battle on low level market, main board manufacturers have decided to raise the ratio of Intel to AMD product solution."

"no. Paul here, thats what my Taiwan friends say, trying to run 64bit??" - Another "64-bit argument"? I've seen this from a lot of AMD fans..

Didn't Woodcrest pwned Opteron in 64-bit apps under a 64-bit operating system? Conroe was seen running Vista and 64-bit Windows Server 2003 as well. Vista is buggy (and still in beta testing)... 99% of all software produced are still 32-bit, and 64-bit drivers are scarce.. Even under 64-bit, it still runs 32-bit software.. Do you think software producers wanna "jump the gun"? What else is new?

Btw.. Intel has just opened a new plant in Ireland ready for 65nm production. Ramping up soon.. And meanwhile AMD is still dogged with capacity issues.

Anonymous said...

The fairy tale says:
- AMD will open 3 fabs by year 2010. And Pigs will fly by 2009
- If is funny how AMD fannies keep saying Conroe is an unreleased products when it mobs the floor with Athlons, yet they keep referring to 64 bit applications that do not exist!
- Sorry Boys and Girls, put down your green pipes and get on the bus

Sh'Nilz said...

Will somebody please ban/shut up shakira or whatever this guy's name is? His posts take up too much space and are full of meaningless numbers and generalizations (I saw something about Romans and Dinosaurs...??) Clearly any comment made by him should be taken at much less than face value, it looks like he either works for AMD or is getting a big chunk of change from them- I've seen him post similar comments on other blogs, and is always met with the same hostile response by all of the other bloggers.

On the real subject- Conroe- seeing as how there are only 5 models set to release, what's going to happen to the whole Pentium line? I know they're set for HUGE price drops, but I just don't see why I would want a $60 Pentium when I could get an E6300 or whatever the bottom Conroe is for $120- and get probably at 4x performance! If I were Intel, I would've named the Conroe line the "Pentium 5" or "Pentium V" (or Pentium funf for that matter) or something with Pentium- for the brand recognition. I think it would help sales.

I also hear something about an option on 975x mobo bios's called "multiplexing"- has anyone heard of this, and do they know if it is the equivalent of reverse HT?