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AMD's Plan To Recover From Its Perfect Storm
An anonymous reader writes "TG Daily has an interesting write-up on AMD's big Q1 loss and how the company plans to get back into the black. AMD admitted that Q1 was a meltdown and not just a miss. Looks like cost cutting, including layoffs, may be on the way. But the company says it won't change its overal direction. The CEO Hector Ruiz is quoted as saying, 'We are not going to change our strategy because of one lousy quarter.'"
The fact that Intel could go to the C2D architecture from low-end to dual-socket server in the space of 6 months is the killer here. Even if 65 nm Barcelonas can give AMD parity on the high-end and mid-range, it'll be 9-12 months before they're all over AMD's lineup. In graphics, it's the same story. By the time R600 gets out the door, G80 will be all over Nvidia's line-up. AMD has a lot of work to do to catch-up on the speed/specs front.
The big problem with AMD is not their processor lineup, it's their business process. They lost $600 mil on $1.2 billion on revenue. That means they needed almost two billion dollars *pinky finger to mouth* to break even. Sure, R&D is expensive, but not that expensive. They need to cut back on expenses to stay in the game.
The "stay the course" strategy?
Why would AMD change course when they haven't even released the fruits from that course yet. The problem is not the course they're on, but how fast they are getting there.
So before you claim that their current products (the course they are on) are failures, shouldn't you wait for them to be released?
There is no "I disagree" mod for a reason. Flamebait, Troll, and Overrated are not substitutes.
1. Issue press release decrying DRM and refuse to support it at a hardware level.
2. Announce and develop proper linux support for the ATI range.
3. ???
4. Profit!
"No, no, no, don't tug on that! You never know what it might be attached to."
ATI has consistently made horrendous linux drivers.
Don't feel bad, the Windows drivers are pretty awful too.
Seven puppies were harmed during the making of this post.
The Core is great for everything. A high end Core 2 Duo is really fast, and fairly efficient. However that's not the only place it's good. A Core Solo is downright killer for low power laptops. It's still pretty zippy on modern apps, yet uses a very minimal amount of power. And everything in-between is covered.
That's the big thing. It's not just on the high end market AMD is having problems, it is the whole lineup, at least when it comes to processors. The Core series just rules, doesn't matter what level you are interested in them for.
It worries me. I'm an Intel fan, and have been for a long time, ever since having massive problems with Athlons back in the KT133 days, but AMD is the thing that's been forcing Intel to develop new technologies so fast. I sure don't want a single processor vendor out there for desktops. However unless they get their act together, we could be looking at that.
It's not like they have to beat Intel at every level, either. They could go the higher performance, without so much regard to power consumption route or something. But when Intel is beating you at basically everything, that just won't work.
Is that recently AMD's best chipsets for desktop systems have come from nVidia. AMD themselves seems to be unwilling or unable to make desktop chipsets, and thus relies on third parties. Of those, nVidia is constantly cited by AMD heads as the one to get. This is even more the case now that nVidia owns ULi and thus the market is reduced by one.
Well, though they haven't said anything, I bet nVidia has kind of a "fuck you" attitude after the ATi buyout. This seems to be confirmed by the fact that nVidia's latest, greatest chipset is currently for Intel only, and has been for some time.
This could screw AMD over if ATi doesn't get good chipsets out the door for them. You can make the most bitchin processor you want, if you don't have a good chipset for it to run on it isn't going to be something worth buying. This is especially true for OEMs. Hobbyists might be ok with a board that doesn't really follow specs and crashes to save some dollars, but the OEMs won't have any of it.
A key principle in business (and armed conflict), is to reinforce success. You direct your resources to where you are strongest, and your opponent is weakest.
.. and being flexible enough to change the plan to suit circumstances. Unexpected opportunities usually have short timeframes before they get patched up - you have to strike whilst the iron is hot, and sink the boot in hard when your opponent is down.
.. witness the Intel open source graphics chips .. winning back the hearts and minds where they know they are weakest.
.. and reinforce it .. then they deserve to die.
You exploit breakthroughs and follow them through. You dont waste resources by throwing them against minefields and barbed wire in some hope to wear your oppoent down over time, especially when you are out-gunned.
Sometimes this means seeing and adapting to opportunities that arrise, which were never part of the original plan
Intel is clearly the opponent of AMD in this contest. Intel's core2duo product consistently outperforms AMD's product on just every windows centric benchmark.
However, when it comes to 64bit linux, the AMD chips are arguably better performing than the core2duo. Never mind the price - AMD already wins there - Im saying that AMD64 X2's run 64bit linux better than Intel Core2Duos. People BUY these dual core AMD CPU's because they make great linux boxes.
Linux is AMD's unplanned, surprise strength. With a good general at the helm, they should have seen this for what it was - an unexpected weakness in the opponents line - and then followed through on it. Rather than slash the price to the bone, which is equivalent to a human wave attack to break a minefield, they should have positioned the AMD64 X2 at that point as 'The 64bit Linux CPU', and done something significant to get ATi video drivers in a state which is attractive to the OSS crowd.
But no, like General Haig at the Somme, its 'one more charge across the wire and we should break through', reinforcing failure and leaving their actual advantage unsupported.
Meanwhile, it appears that Intel understand whats going down, and doing something about it
People whinge and whine about multi-core chips, claiming 'there is no software that takes advantage of it yet', which is total crap - Linux thrives on multicore chips, even as a desktop. LAMP is inherently multi threaded. Again, its Intel leading the core count here not AMD. Everything indicates that Intel is addressing it's weaknesses when it comes to being the best bang for the buck Linux platform.
If AMD are too short sighted to recognise their real strength in the market
YOU, yes you are whats wrong today. You and your attitude is what drives companies out of business, which FAR to many people have. You want immediate gratification for you stock value. Back in the old days companies were invested in, not bet upon, by people who viewed investments in increments of 5,10 or even 20 years. They looked for dividends, not windfall profits. Back when companies actualy paid dividends people made a good return on their investments. These days with every pencil pushing asshole in NYC screaming SELL SELL SELL at the top of their lungs if a company misses "The Streets" target by even a few pennies, its surprising that a publicly traded company even stays in business.
Hey KID! Yeah you, get the fuck off my lawn!
Of course, if Captain Smith had maintained his course, the whole fracas (or at least the sinking part) might have been avoided...
I am literally 3000 tokens away from the chaotic crossbow --Stephen
I agree with you statements. My dad is of the "old days" and frowns upon the newer generation. I do too, because what I learned from him. On the other hand, it is still perfectly possible to invest in the long term and get dividends. The only difference, is that you won't get really-really-fucking-rich which is what happens when you have a lucky streak with in what you just described. The old way is to secure yourself, the new way is to have a chance to get rich quick.
Somehow the American dream (if I understood it correctly as a European) to "make it" by hard work and perseverance has been replaced by "get rich quick". I might have misunderstood though.
Ahhh...the great dumpster continuum. Many a free computer will be found there. -- sowth (748135)
I don't quite understand how AMD are falling so far behind in the performance race.
They have what, on paper, should be a superior architecture. Core is excellent, but it's still an evolution of a 32-bit design and handicapped by the FSB. With a clean-sheet 64-bit design, Hypertransport and an on-die memory controller, AMD should easily be able to put out something competitive with Intel's offerings. As soon as their 65nm process was up and running they should have followed Intel's Lead and put 2 dies in one package to create a 4-core chip. The architecture is already designed to scale to at least 8-way (Opteron), and they have the advantage that they can link the cores internally via hypertransport. This would need very little R&D - it would just be a new configuration of proven technology.
I hear that in pure 64-bit operation things are much closer anyway, and that's obviously the way of the future.
That's why I bought an AMD Turion X2 laptop recently, well knowing that I sacrificed both performance and battery life.
I'm glad you're the exception and not the rule, for if we had a free market when customers buy the worst chip in fear anything else would harm free market forces, those free market forces wouldn't work in the first place.
The reason Intel and AMD are fighting for faster, more efficient chips, is because people do buy the faster, more efficient chips. Doing otherwise sends AMD the wrong message.