Lacklustre competition distorts the processor market
RECENT NEWS that Intel's processor market share has overtaken the 80 per cent mark for the first time in four years marks a return to uncompetitive market conditions previously seen in the industry. Not coincidently, AMD's market share slipped 1.4 per cent to 11.5 per cent.
We've seen this incumbent dominant position held by Intel before. Before AMD mounted a strong challenge with its Athlon offerings, Intel had a less than stellar processor offering with its Pentium 4 Netburst architecture, which was deservingly lambasted as power-hungry and stubbornly unscalable.
Only AMD's brilliantly received K7 architecture, co-developed with Motorola, which presented superior performance to the incumbent Pentium III, and the subsequent Athlon XP, woke Intel up and shifted it into second gear.
Similarly, it wasn't until AMD established processors with its x86-64 extensions that Intel finally made the move to include support for 64-bit architecture, and ultimately borrowed from AMD's lead.
Now, again, Intel's Core i7 processors are an unsubstantial improvement over the previous Core 2 marchitecture. They are over-priced and have little competition from AMD's current CPU offerings.
While Intel has stagnated, AMD has suffered. Its Phenom offerings were criticised for arriving late and having poor performance, a buggy implementation (the TLB fiasco), and providing little competition to Intel's superior Core series. Not much has improved since then.
Thus it's no surprise that Intel's fortunes are at a recent high, and that the firm is pulling in substantial revenues and gaining even more market share.
Fortunately some light has come in the form of AMD's Phenom II processors, which can almost match the performance of the newer Intel CPUs, while being highly cost-effective and thus fairly attractive.
But this hasn't yet been enough. Intel has found itself back in pole position without the need to either reduce its prices due to competition or bring forward any earth-shattering technology innovations. Instead, Intel's product line enhancements seem to be being postponed while competition from AMD remains so weak.
Even motherboards have rocketed in price due to the increased costs of Intel's Core i7 chipset pricing, further ratcheting up costs for the enthusiast and performance-hungry.
While AMD has seen some revival through its Shanghai-based Phenom II processors, Intel can simply produce cut-down Nehalem-based CPUs and provide derivations in the form of the Lynnfield i3 and i5 series chips to match AMD's budget Phenom II offerings, instead of providing a better performing, lower cost architecture in response to any serious competition.
Thus, Intel has AMD completely stuffed in all areas of the desktop market, from budget to workstation performance parts, both in price and in performance. AMD can just about compete with an older DDR2 offering and cheaper chipset platform, but with likely discounting of Intel's Core i5 parts in the offing, AMD's immediate future looks decidedly bleak, absent any further across the board AMD discounting.
Similarly, Intel is completely dominating the laptop market, where its low-power laptop-centric Core range is in a different league from that of AMD's Turion offerings, and even its multi-branded Pentium and Celeron budget lines are favoured over those of AMD's poorer cousins.
This picture isn't repeated in the low-end netbook market, where Intel's Atom offerings are suffering competition from the likes of Nvidia and ARM. Intel has been forced to offer substantially discounted parts even when demand is high, to gain a foothold in the burgeoning netbook market. Yet AMD has little to offer in this space, with the Athlon Neo a decidedly late entry.
Late entries and poor showings seem to be the usual performance from AMD lately, and unfortunately this is not likely to change any time soon. (Albeit its ATI acquisition seems to be paying good dividends when compared to Nvidia's recent efforts).
It is evident that consumers and IT buyers are suffering in the desktop and workstation markets due to weak competition from Intel's only real competitor. Either AMD needs to come up with a new winning design, something not immediately evident from its current roadmaps, VIA needs to buck up and take a shot at the mainstream, or even more unlikely a new entrant such as Nvidia would need to come up with a serious first entry into the market to shake things up.
Either way, it seems that over-priced Intel processors are here to stay for at least the medium term, with little in the way of awe-inspiring performance advances or superior budget offerings to look forward to. µ
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'Intel's Core i7 processors are an unsubstantial improvement over the previous Core 2 marchitecture'
Yeah right!! 'only' about THIRTY percent faster per clock than core 2. which if i recall is the same sort of jump core 2 provided over K8. The article is a dig at intels dominance, which hasnt come about by resting on its laurels and overpricing processors again. Its come about because they do indeed deserve it after creating two exceptional architectures in a row.
This article is total nonsense.
@ vp
the 30% boost was only seen in some applications. In day to day usage and gaming the increase was much lower.
I think the article is right on. So rejoice all you Intel fanbois! This is what you've been waiting for, AMD down, Intel up. Of course, this also means CPU price is staying up and innovation is going back to pre-Athlon days. There is a solution though, for every Intel CPU you buy, get 2 AMD, depending on your usage. After all, not all your cpus are going to be I7. Me, I have 2 Intel, 5 AMD & one Via. I like fast machines but I also like them cheap. And they better stay cheap !^(#@*(
A simple solution for all you enthusiasts:
when building systems for clients and friends use AMD to save money and support competition. When building for yourself use intel if you need the extra power intel provides.
Who cares about i7 being faster unless you really need the power everyday.
For your dailly needs about every modern midrange CPU will do, even when you do some rendering from time to time.
Have a life other than the latest new toy.
the fastest processor only gives u bragging rights and a empty wallet
depending on performance price ratio amd and intel are neck and neck, but who is the fastest? intel wins, its as fast my wallet goes slim
@kirk
The author of your comment is a monkey.
Perhaps you should write articles for the Inq...?
And I'll second the sentiment that even moderately-endowed modern processors will comfortably manage all the work thrown at them by by Joe Random Punter. Why spend a fortune on the latest and greatest Intel concoction when a cheap AMD CPU will serve more than adequately?
It's all about bragging rights for spotty adolescents, I suspect.
In day to day use most people can get away with an intel atom crying out loud. Is that intels fault? No! That is an irrelevant argument.
Claiming that i7 is an unsubstantial improvement by relying on the fact that general performance now is so impressive many people do not need anything more than a ultra low power chip is just a bunch of bullshit. i7 is a leap any which way you look at it on the hardware side.
If the requirements of the consumer have changed then its hardly intels fault now is it? they pump out the high end processors, AND the low end gear anyone could ever ask for.
The postwriter is trying to claim that it is intel to blame for stagnating the market, when all they have done is delivering faster than AMD architecture for the past three years, alongside competitively priced products at all levels. atom is stone cold proof of this. intel has transformed budget X86 computing in the space of two years with atom.....which makes this a ridiculous post. ridiculous!!!!
If anyone is to blame. It is AMD. You cannot complain that Manchester United win the title three years in a row, if the competition is lacklustre. Intel have simply been too good and naturally been able to dictate market conditions.
AMD is digging their own grave by not releasing server chipsets. Who wants to use nVidia chipsets for AMD servers now that they are bitter enemies? I am amazed at how AMD has squandered the opportunities to capitalize on the ATI assets (by not fully using their chipset technologies for instance)
If the intel CPUs are overpriced, then surely AMD would overtake them. An i7 920 for $200 hardly seems overpriced to me.
We all know that Phenom II is as good as or even better than Core2. If Dean think Nehalem/Lynnfield is small step, then why all the review sites mention that i5/i3 beats both Phenom II and Core2 at the same price point?
AMD lost market share because Intel has better, faster, less power hungry CPU's, so it is Intel's fault? If so Intel should not release Nehalem and just keep Core2 in the market as Phenom II is matching its performance? Wow, a new kind of logic to keep the competition.
I can conclude that Dean is an Intel hater, or perhaps he got some kind of incentive from Ruiz to keep crying for poor AMD.
Disregarding the Nehalem (i7/i5) class of processors for a moment, in the Core 2 Duo space Intel is increasingly competing with itself.
Let's compare the available dual core Intel processors. The range stretches from the puny E3200 at $43 list price and 2.4 GHz to the mighty E8600 at $266 list price and 3.33 GHz.
At 8 times the price, does anyone think the E8600 is 8 times faster than the E3200? Who in his right mind would buy a 3.16 GHz E8500 at $183 when he can instead buy a 2.93 GHz E6500 for only $84?
Or let's leave the top end and the bottom end out of this discussion, as any good statistician will do.
Two notches up from the E3200 we have the E5300 at $64 and 2.6 GHz, two notches down from the E8600 we have the E8400 at $163 and 3.0 GHz. Almost identical clock frequency with a price difference of almost a factor three.
My point is, most of Intel's mainstream processors are clustered in a very narrow clock frequency band between the mid-twos and the low threes. Gigahertz, that is. So why pay more than $266 for an E8600 or $183 for an E8500 or $163 for an E8400 when a E6500 at $84 already reaches 2.93 GHz?
In conclusion, it's not primarily AMD that Intel dual core processors are competing with. Instead, more than 10 dual core Intel processors compete in a very narrow clock frequency band against each other.
"I've seen the enemy and it is us!"
I like it.
The truth is that strong competition drives innovation up and prices down... A stronger AMD will bring only benefits to the table, so we must hope AMD come up with something pretty good.
What this article misses, well one of the things, is that the game has changed. It's not about Ghz and ultra performance anymore. The new markets are in handheld devices and making computing pervasive. This is the new battle ground, not Intel Vs AMD in high power desktops for gamers. Not that gamers aren't a good market but the big bucks are invested in the new growth markets not the stagnant old ones.
Let's have some common sense and leave the emotional BS at home.
Yes, I am an Intel Hater. The last Intel process I owned was back when Intel sued AMD & Cyrix for use of the MMX name. They were licensed to use the technology they just couldn’t say that they had it, and to make matters worse Intel had just released and recalled processor that they new had issues but release anyway. This was the first time AMD had a small performance advantage over Intel. Intel just has some real poor business practices that are of the non-competitive nature. I still remember when they were going to put the external serial number on the processors that could be monitored and tracked by our government over the Internet (A lot of complaint canned that).
AMD has had it’s ups and downs, and had it’s share of issues, but I will be Damned if I will ever pay $999 for a processor when the Phenom II 955 I just bought for $175 does the job just fine. I took the extra money and bought 4 OCZ Vertex Turbo SSD drives, 16 GB Ram, and a Blu Ray Drive and I am much happier with the system.
I bet the writer of this article and all the Intel Lovers also have IPhones too. Even though they are made is sweatshops in China and lock out anything they decide we shouldn’t have or has a possibility of interrupting their cash flow.
There is obviously truth in saying that competition drives prices down, but it's too simplistic to broadly say that Intel's CPUs are overpriced.
AMD & Intel both have a broad range of CPUs in terms of performance & price. AMD hasn't been able to match Intel's Atom at the very low end, so I suppose the Atom isn't overpriced compared to AMD. The high end always is going to cost more and if you think that all of Intel's CPUs sell for $999, you haven't been paying attention. Really, what % of consumers buy the Extreme editions ? Not me. Never have, never will.
The real battleground for market share is in the middle where most of the volume & revenue are and those prices are much lower than $999.
I just bought some pretty impressive full size Core 2 Duo laptops for <$600 and the PC prices continue to drop. Just based upon this article, that would be hard to believe in our "uncompetitive" market. Surely, CPU prices on the average must be dropping as well ? And whether or not AMD participates, it's still to Intel's advantage to continue to follow Moore's Law which automatically increases performance and lowers costs.
I have been interested in buying AMD instead of Intel many times and when it went down to it - an AMD system was always simply too expensive when compared to Intel - at least in the middle east.I was always have to settle for a less powerful system than the Intel one for the same price - that is why I have not bought AMD yet...not out of love to Intel because in the pentium-athlon days I used to curse them out loud and dream of having an AMD athlon but it was too expensive.
I wish the best for AMD and hope they come out on top again in the future and hope they bring me a system that I could be proud of getting for the price that I did - and not have me questioning whether I just bought a computer or have been bamboozled.
Find your chi...........AMD
(this should be their new slogan - it rhymes too...)
In all of these posts that I have read which is not all of them. No one mentions amd violation of X86 license. Intel can put the screws on amd at a ny second, day, weeks and months.
If snot comes out of my nose when I sneeze.Why are feet so flat?
Those are big words for a little kid in preschool, but you should wait until you get a bit older before trying to write a whole paragraph that makes any sense at all.
Quote: "amd must croke! "
Are you for real, I suppose you probably love Microsoft too. The more AMD drops the less INTEL has to innovate and improve and the more they can hike up the price.
Quote: " No one mentions amd violation of X86 license"
INTEL keeps screaming that, but has yet to follow through. I am sure AMD seriously considered the split of the company and it's possible legal issues down the road. It's not like INTEL outright nicking a universities patent to create the Core 2 and then settling out of court.
Quote: "AMD hasn't been able to match Intel's Atom"
They choose not too, They are going for "ultrathin" notebooks that can actually do something other than browse the internet and check E-Mail (AMD Neo).
Quote: "I just bought some pretty impressive full size Core 2 Duo laptops for $600"
I just bought 2 full size AMD Turion laptops with DVD burners, webcams, and 160 gb drives for $349 each (NEW).
AMD is a shining example of this quote "We have done so much with so little for so long that we are now qualified to do anything with nothing".
AMD operates off of less than 10% of Intel's annual revenue. Does not advertise and has a very small (in comparison) R&D budget. Yet AMD still manages to stay just a few steps in from of or behind INTEL. That is a task none of us here could accomplish.
It's sad for AMD that they had such (relative) success several years ago, to wind up where they are now with their product line.
AMD seems to have devolved their product range to cheap (sub $200) low/mainstream processors.
I don't know what they were thinking as what most of the market wants, is a mid-high end processor which is underclocked and sold at a cheaper price point than the flagship, around the $350USD mark.
It's interesting that ever since AMD bought ATi, their processors have progressively become less competitive, and yet ATi's products are still top-notch and super highly competitive.
I'm not sure if this is all part of AMD's game strategy, but if they want to make money they need to re-think their target audience, and maybe reconsider their cpu architecture.
Quote: "They choose not to (do an Atom), They are going for "ultrathin" notebooks .."
Actually, AMD is unable to play in this market because Intel's die is so much smaller than AMD's, AMD can't touch the price and still make money. And AMD's die is too big for netbooks anyway and have too much power. They're "trying" for UltraThin ... trying to catch up to Intel who already has a whole new line of CPUs with high performance & lower power.
Quote: "I just bought 2 full size AMD Turion laptops with DVD burners, webcams, and 160 gb drives for $349 each (NEW)."
The Intel Core 2 Duo laptops were also new, came with DVD burners, 320GB HDD, 3GB Ram, webcam, Vista Premium. Price was less than $600 (actually $550) and considerably faster than your (single core?) Turion.
As for AMD operating on less than 10% Intel's annual revenue -- If you sell less volume, it costs you less as well to build it.
As for no advertising. True. Intel does all the x86 advertising, creates new markets ... and AMD rides their coat-tails. USB, SSD, WiFi, WiMAX, Ultra-Thin, Netbooks (but no AMD)
It is a remark of the fact that today, INTEL has the upper hand in CPU market and because of this, its prices have soared to the incredible 500$ per "Core i7 i7-940 2.93GHz (4.8 GT/sec,8MB,S1366) BOX", more exact to 587$ without taxes.
Because AMD for instance, doesn't has for the moment a rival, Intel affords to sell it this high. We are back I might add to the 1999, when PII and PIII CPU's were similar in prices (they actually cost less then today's 587$, but if you add inflation and the power of buying you reach similar values). AMD has come with Athlon XP, soket A architecture that were much better then Intel, and this architecture lead to the development of today's SATA, USB 2, improved chipsets, and all over to the world as we have it today. The difference is that the best AMD MoBo, ASUS K7N8X-Deluxe cost little over 120$, compared with todays' ASUS X55 chipsets MoBo's, 270$...Rampage, etc...
The lack of competition will set Intel in a small increase of performance with every new generation, over the previous one, changes in sockets every 6 months, etc...We lived this with Intel and are AFFRAID!
While it's clear that Intel is the only option at the very high and very low ends, AMD can still pull a punch in the lower and middle segments.
Core-i3 is mentioned as a competitor, but where are they? I don't think they're available yet.
From what I've found AMD offers CPUs that are low cost for their computing power, with cheapish motherboards available as well. This is even more true if we limit the comparison to equipment well suited for later upgrade, which means support for DDR3 and a CPU socket that will be supported by new CPUs down the line. Sockets AM2, AM2+ and 775 are thus out of question.
AMD is somewhat behind in power efficiency for their CPUs though.
I think this reflects the fact that the x86 market is now mature, there just aren’t that many opportunities for growth left. That’s why Intel has been trying to push into the mobile market with Atom. Trouble is, there’s already an 800lb gorilla in that room, in the form of ARM, which probably ships several times as many units worldwide as x86 does.
And what’s more, that gorilla is interested in returning the favour, by muscling in on some of Intel’s existing market, particularly in netbooks.
Interesting times ahead...
Yeah, I call him the ruiner. First, he has made many bad decision(s). Second, he has hired the wrong people at the wrong places. Third, he was the worst CEO of AMD ever, with shareholder's heap of letdown. Fourth, he earned big pile of monies while AMD is sinking. But, the worst of all is the decision from Jerry Sanders who had hired him from Motorolla, because when he was the CEO of Motorolla, the revenued of Semiconductor division gradually decreased.
the reason of companies chasing moors law is not that there are 2 participants, its the upgrade path.
I have a computer, its 15 years old it still works why buy another? because the next one is 1000x faster, but I cant afford 100000 quid - thats ok it costs the same as last time (all your money)
This article is one big rant that doesn't make sense and contradicts itself. It's arguing that Intel has stagnated and it's CPUs are overpriced, blah, blah, blah. Yet the cpu that he are talking about, the i7, is brand new and even the lowest end version is faster than the fastest from AMD. The lowest even version is $280. If the author thinks that $280 is "too expensive" for something so complicated to make, he should go design and sell a cpu for $10. The i7 too expensive? Get the new i5, that's for people who want a more cost effective cpu.
Wow... complaining about stagnation when the i7 is about a year old AND the new i5s just came out. I hope you didn't expect them to redesign a whole new architecture every year just to make you happy.
The market is not distorted by lack of competition, it just does what markets do in this situation.
How soon we forget that back in the days of the Pentium 4, AMD was charging $1200 for the fastest single core Athlon desktop processors. The day Core 2 was launched, AMD slashed prices by 30-70%, so one could argue it was Core 2 Duo that saved us from AMD ripping us off.
Its not Intel's fault AMD keeps stepping on its own dick by producing crappy processors they have to give away. And since the launch of Core 2, Intel has kept up a steady cadence of new processor and processes (tick-tock, anyone?) which included quad core a year ahead of AMD, i7 and i5.
Hell, your own articles on INQ tout the unsurpassed performance of the i7 and you can get an i7 920 for around $200.
Intel paid AMD $1.25 billion dollars for abusing their position.
The 10% performance gain for 100% price increase?
So in car terms, you can the 1.6 petrol for £10,000 or the 1.8 petrol for £20,000 -- hmmm now let me think about that choice, oh and by the way the 1.8 is only faster on the motorway.... hmmm....
[I didn't include diesels in this analogy because they are all crap and give kids asthma.]