Sunday, January 29, 2006

An AMD-DELL deal will be good for AMD stock price

But such a deal will be bad for AMD in the long term. Let me re-iterate, AMD needs DELL to stay 100% INTEL for several reasons:

1) DELL keeps sucking INTEL blood by paying lower and lower prices for INTEL components, DELL gets more INTEL pie and becomes more dominant in INTEL space.

2) With DELL's lower prices, HPQ, Lenovo, Acer, Gateway and whitebox vendors find it impossible to make a dime competing against DELL in INTEL space and will move to more AMD. The math: DELL has only 17% of the PC market, the rest is 83%.

3) As DELL stuck with hot and slow Xeon, SUN will be more motivated to commit more to Opteron.

Eventually, DELL on INTEL will be like SGI on Itanium, DELL is just an expendable screw driver company which our civilization does not need. Any Chinese farmer can assemble a PC that frags Dell XPS by using AMD64, NF4, SLI and other quality components.

Once AMD starts selling cheap to DELL, the above advantages AMD gets from INTEL-DELL axis will be gone. Furthermore, with Dell's low quality and bad service, AMD's brand will be in serious danger of being damaged by DELL.

1 Comments:

Anonymous Crainial said...

Amen, now if only Apple would have seen the light...

5:22 PM, February 10, 2006  

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