Bill Fleckstein: Analysis of AMD's suit vs. Intel

Bill Fleckstein is somewhat of a financial guru in the US. He also quite accurately predicted the collapse of tech bubble and the high .com stock prices–when other financial advisors laughed him to scorn and said the tech expansion would only continue. I find his analysis and insight to be quite singular and acute. Just what he says about Intel’s bullying so people won’t use AMD makes me want to do my best to buy AMD from now on (provided AMD stays a cutting-edge company and never resorts to Intel’s coercion).

http://moneycentral.msn.com/content/P121537.asp

You mean AMD will become an Intel but without greed? Do AMD’s directors and engineers want to work for the mass only receiving US$20,000 per year and conducting their works and private lives like the saints of Confucius and Buddha?

I have long believed that Intel is essentially a marketing (muscle?) machine, not a technological powerhouse.

I don’t think anyone serious at Anandtech or THG or Ace’s hardware or Ars technica or the equivalent sites in other languages thinks like that. How does a marketing machine develop CPUs? By copying and stealing from others? Then why couldn’t some Chinese companies do the same? Because they don’t have as much influence in Washington DC?

If anything, Intel should do more about marketing in order to have better and wider contacts with end user consumers worldwide because computers by now have become as ubiquitous as TVs and phones (which is why Intel recently employed a former Samsung marketing guy who successfully transformed Samsung from an engineer’s house at the end of the world into a global brand of more value than Sony.)

I don’t see anything that Fleckstein said where he meant AMD would become Intel without greed; in fact, he fairly pointed out that

“…AMD officials also said the company had not received one negative comment from a customer or business partner. However, in all fairness, that might change over time.”

I had always wondered why I suddenly saw fewer Gateway AMD powered computers. This explains why.

I’m not familar with those other sites, and I can agree Fleckstein’s thought of Intel being more a “marketing machine than technological powerhouse” is erroneous.

Otherwise, the whole point of the article seems to support how Intel bullies others into not using AMD. Sure, other companies have done it, but is it right and should it not be stopped, so AMD is given a fair chance to compete? The fact is that although these ‘threats and tactics’ were allegedly done by lower-level Intel managers, a CEO by definition is responsible for knowing and being responsible for everything that happens in the company (that falls under the ‘daily business operations’ part of a CEO’s contract, something Ken Lay of Enron said he wasn’t responsible for), even if it’s a ‘lower-level’ manager. If the CEO isn’t getting that information, nor is aware of it, then the CEO is responsible for seeing he finds ways to get informed. Otherwise, if the CEO allows ‘plausible deniability,’ said CEO is complicit and approves of said under-handed tactics.

That’s a little off-topic, but the point is that while Intel very well made it to the top with innovation at first, it unethically uses its muscle now to limit AMD’s reach, because it is obviously threatened by AMD’s work. So, I hope at least Intel is seriously sanctioned for this behavior. Should AMD ‘move up’ and resort to the same tactics in the future, then it should have the same done to it then as well. However, the only sure thing is that we’ll have to wait to see what happens and what its effects are.

Intel may be a US company but “ethics” is a universal thing. I don’t see why it is immoral or against ethics to lower prices in order to compete better or why AMD can’t do the same. If AMD wanted Gateway or Acer to have AMD processors on all their desktop and notebook computers, there is surely just one way to do it, right? :slight_smile:

To me, it’s AMD that looks dirty and getting dirtier. It is relying more and more on lawsuits and popular sentiments against the big guys instead of concentrating on developing better technologies and cutting cost.

I said nothing of Intel lowering prices or AMD lowering prices. In fact, the article points out that AMD offered to give away (free) it’s first million processors. Then, this is what happened:

“Eager to break into the commercial market, and to earn a place in H-P’s successful ‘Evo’ product line, AMD agreed instead to provide H-P with the first million microprocessors for free, in an attempt to overcome Intel’s financial hold over H-P. On the eve of the launch, H-P disclosed its plan to Intel, which told H-P it considered AMD’s entry into H-P’s commercial line a ‘Richter 10’ event. . . . Intel went so far as to pressure H-P’s senior management to consider firing the H-P executive who spearheaded the AMD commercial desktop proposal.”

Intel clearly cut AMD off at the knees here and (it’s not stated if he ended up fired) tried to get the HP exec. fired who pitched the proposal. That’s just being mean and manipulative. Intel wasn’t even an ‘interested party’ in the deal (meaning they didn’t bid for the contract nor were involved in this proposal at all prior to this last-minute arm-twisting). The problem is that there are clear signs that Intel has engaged in unfair practices to stifle competition. These are certainly far from idle accusations; judging from the raids on Intel offices, other people have concurred there is sufficient ‘probable cause’ to do such searches (which at least in the US means producing some evidence and then convincing a judge, with lawyers for both parties present). Because of that, this seems to have passed the point of popular sentiment only, as it’s now a matter of record than only suspicion.