Intel's BK is now inevitable. Intel's BK is a result of colossal strategic and tactical blunders by Intel management and their total inability to adapt to a changing climate. They will go extinct just like the dinosaurs. The time of AMD64 has come.
The situation today is totally different from 2002. The differences are
0) AMD now has gathered all the greatest minds on computer and system architecture. Chief architects of Opteron, Alpha, Power, UltraSparc, MIPS, Itanium and PA-RISC are all in AMD camp.
1) AMD now has the most advanced FAB process through its partnership with IBM and its APM 3.0 FAB automation technology excels.
2) AMD firmly controls the high end server with 8P 16 core Opteron technology at an affordable price.
3) 95% of Intel's inventory and 70% of Intel's production are more than 20% slower than AMD64 and Conroe and thus become totally obsolete.
4) AMD is doubling its capacity by the end of 2006. There is an oversupply of CPUs. AMD's capacity will be able to supply over 80% of the market by the end of 2008.
5) AMD's average cost per CPU is at least $40 lower than Intel's.
6) The AMD anti-trust lawsuit is tying Intel's hands. Intel found it impossible to impose exclusion agreements on OEMs.
7) The 65nm K8s will be here any time soon.
8) The next gen 65nm Rev G core with 60% integer performance increase and 200% FP performance increase is just six months away.
9) AMD+ATI will be a killer enterprise.
10) The next gen Bulldozer mobile paltform based on the same Rev G core will shatter competition.
11) The OLPC project will equip the children of the world with the $100 laptops, which will establish AMD Inside as the standard for furture generations.
12) The OEMs all see (0)-(11) above and are embracing AMD like there is no tomorrow. Former Intel strongholds such as DELL and IBM have suffered enough and are now introducing their AMD64 business and consumer offerings. Traditional AMD alliances such as HP, SUN, Lenovo and Gateway are also expanding their offerings.
The DELL-AMD alliance will expand AMD's footprint in the commercial client market and beyond. I projected that AMD will exit 2006 with 40% market share(run rate), leaving Intel at 57%.
I pointed out to Intel execs in 2005 that their share loss is inevitable due to FAB36 ramp and AMD's advantage with Direct Connect Architcture. In view of that inevitability, I suggested Intel to cut production and hike ASP to maintain constant revenue.
But, Intel miscalculated.
From the 2Q06 conference call transcript, Intel truly believed their loss of unit share in the previous quarters was due to the shortage of low end 865 chipsets. Andy Bryant actually blamed himself for making the suggestion to cut 865 chipset production. To remedy the situation, Intel actually ramped production of those chipsets and their companion CPUs, and now Intel is in a deep pile of unwanted legacy chips.
This was a tragic miscalculation -- as Intel execs refused to recognize that it was AMD64's strength that pushed AMD up.
But that's not all. Intel made the next strategic blunder which will prove fatal. It again failed to adapt to the changing situation, instead of thinking anew, they resorted the tried and old tactics. "Opereation Crush", "Operation checkmate", those old Andy Grove campaigns were recycled and reused in an AMD64 era. Intel's whole calculation was based on the assumption that C0nroe will take the high end, Pentum D will take the mainstream, while Pentium 4 takes the low end, thus pushing Athlon 64 out of the market. However, AMD has forseen this coming (even I have predicted this), and they quickly changed their battle plan: Athlon 64 X2 becomes the mainstream. The result is now Athlon 64 X2 takes the sweet spot, and Pentium D becomes totally unwanted. In the low end, Athlon 64 and Sempron frag Pentium 4 and Celerons with more performance and less power consumption. Now, if you consider that legacy Netburst and IA32 chips are still the majority of Intel's inventory and production, you know Intel is in a terrible situation.
With FAB36 and Chartered FAb7 cranking like crazy and DELL's insatiable appetite for low price and high performance desktop CPUs, AMD will rule and Intel will be pushed out.
AMD has won the decisive battle in 3Q06. History will record this as the true turning point in a war that will soon end with Intel's final capitulation.