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Subject: Re: Introducing "No-Moore's Law"

Author: Matt Taylor

Date: 06:56:59 03/01/03

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On March 01, 2003 at 00:07:01, Robert Hyatt wrote:

>What is the point of the question?
>
>Will I buy a 3ghz machine today and buy a 3.2ghz machine in 6 months?  No.
>But the risk is will I buy that 3.0ghz if your competition is right behind
>you in speed and significantly below you in cost (AMD vs Intel for example).
>
>But if you offer me 3.5ghz today, I'll take it if I am in the market for a
>new machine, no questions asked.

There is a -lot- of pro-Intel prebias. Even a coworker of mine who knows enough
assembly to write self-modifying code seems to think AMD is inferior to Intel.
He once suggested that AMD chips are somehow inferior to Intel chips. While that
is obviously stupid, I think that is representative of a lot of people. I was in
CompUSA one day looking for something network-related. I couldn't find it, so I
was waiting on a sales rep talking to two older women about buying a computer.
He recommended an AMD-based machine because of cost, and they politely denied it
and requested Intel specifically because one had a son that told her to get
Intel.

I don't think Intel is completely ignorant of this, either...

>I still don't see how this is an issue.  How will producing a slower product
>today help me tomorrow?  Once I lose a customer to a competitor, it is _much_
>harder to get them _back_.  I'd want to offer the best that I could offer, to
>drain _their_ customers that need more performance.
>
>IE Cray _never_ played these games, _ever_.
>
>I don't believe any other vendor does either.

That all depends. You only have to stay just ahead of your competitor in
performance. Many people buy the high-end part from the high-end company unless
it is unreasonably expensive. The 3.06 GHz Pentium 4 is generally regarded as
faster than the AthlonXP 2800 or AthlonXP 3000. (Whether it actually is or not
is a matter of debate, but popular opinion is what counts here.)

Dell and Gateway purchase Intel processors in mass quantity. Dell phazed out its
Athlon line several years ago. Gateway did so shortly thereafter. The desktop
market is -dominated- by prebuilt PCs. Dell and Gateway are major players in
this market, and both of them use Intel processors exclusively thanks to Intel
strongarm tactics.

Basically what I am saying is that Intel holds all the cards. Even when the
high-end Pentium 4 was obviously slower than the high-end Athlon, Intel was
heavily favored. The balance has shifted substantially as Intel is more
competitive now.

Assuming Intel has consistent customers (as I have argued), it is not
unreasonable to think they might take advantage of that. Releasing chips as fast
as they can means nobody is going to buy the 1.8 GHz because the 2.6 GHz is only
$50 more. Releasing chips slowly means the consumer buys 1.8 GHz and upgrades to
3.6 GHz a couple years later. This gives them more revenue in the long run.

-Matt



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