Re:Intel buying Mobileye for up to $16B to expand in self-dr...
by mtgx on Monday March 13, 2017 @12:19PM
(#13859167)
> if they feel threatened by Ryzen they can just lower the price of their chips to Ryzen prices because they have a manufacturing advantage.
If it would've been so easy, they would've done it with Atom in the mobile market. But it wasn't. Intel was losing $1 billion a quarter in mobile just to be competitive on price.
Intel absolutely lacks the cost structure to compete with Qualcomm's ARM chips, and that has already been proven. It's not a theory.
As for Ryzen, they can lower prices, but not by as much as you may think. Lowering prices is directly proportional with how many people Intel will have to fire to accommodate for a slightly lower cost structure that's more competitive with AMD.
For every 10% average reduction in price, Intel may have to fire at least a few thousand employees (across divisions, but more likely by gutting some non-profitable research projects, in the beginning).
However, those layoffs will also look bad on Intel's public image, so don't expect Intel to lower prices strategically across product lines to compete against AMD without serious consideration. But I really don't expect them to lower their average price point by more than 10% for the next few years, until Intel comes out with a more "streamlined" (fewer features) microarchitecture, that's more cost-effective to build.
If it would've been so easy, they would've done it with Atom in the mobile market. But it wasn't. Intel was losing $1 billion a quarter in mobile just to be competitive on price.
Intel absolutely lacks the cost structure to compete with Qualcomm's ARM chips, and that has already been proven. It's not a theory.
As for Ryzen, they can lower prices, but not by as much as you may think. Lowering prices is directly proportional with how many people Intel will have to fire to accommodate for a slightly lower cost structure that's more competitive with AMD.
For every 10% average reduction in price, Intel may have to fire at least a few thousand employees (across divisions, but more likely by gutting some non-profitable research projects, in the beginning).
However, those layoffs will also look bad on Intel's public image, so don't expect Intel to lower prices strategically across product lines to compete against AMD without serious consideration. But I really don't expect them to lower their average price point by more than 10% for the next few years, until Intel comes out with a more "streamlined" (fewer features) microarchitecture, that's more cost-effective to build.