The corps charge as much as they can get for their CPUs, that's just the way it is.
...
That is the net result, actually! It is just a tricky way of doing it. :ninja:
You don't under-sell by too much. $20-40 is as far as this can go on a CPU, but they did it by about $80 on the Radeon 68x0 (accidental, perhaps/probably).
Your share holders want one thing: profit.
If AMD can sell the new CPUs at an additional profit compared to the current ones, while also undercutting the competition (however slightly), you are winning. :thumbsup:
AND, if you can do this while maintaining the mind-share of "best bang/buck" and then charge MORE and make MORE profit... you've got a winner!
AMD is looking at a boost of about 25% or more from the new crop of chips per investment into the die itself. That said, Phenom II will be around for some time, but I imagine the x6 will vanish very quickly, with the x4 maybe even seeing a revamp. This would fit the strategy of aiming at the low-mainstream ballpark. You still have some 45nm capacity to use until it is converted to 32nm...:hmm:
Meanwhile, your main-dog's die is a pretty hefty size and the price you can get for it is decreasing, but you are prepared to make smaller dies to meet demand for the lower end and larger dies to meet the competition head-on.
That means you are prepared for the future(the whole point of Bulldozer) and you can focus on becoming the predator (the new CEO's own stated ambitions). To be the predator, you have to make your prey (the customer) believe you are the better deal when you really don't have much more to offer over the competition.
One proven way is to cause inflated demand by limiting supply. BUT, if you actually limit supply, you MAY lose money! :thumbsdown: So you just create the
illusion of a supply problem by causing a rush on the
first round of shipments by under-pricing your product enough that stocks dry up more quickly than they can be refilled. Now, the next batch can be sold at a higher value and those in waiting in the wings will rush to buy them, driving costs up even more.:biggrin:
In the end, the corp gets more money, more press, more mind-share, and machines running the "AMD FX" processor will be in higher demand than would otherwise be the case ( remember, techs/enthusiasts influence buying decisions for about 40% or more of the total market ).
Psychology is very much integral to business tactics - both of which I study relentlessly (and physics, cosmology, what-have-ya).
NOT saying I'm right - far from it... more so HOPING I'm right!!:$
See, it makes me feel better about the prices, and I see some significant evidence to support such a move in the history of this CEO, and the upcoming price breaks from Intel on Sandy Bridge... AMD will factor those in up front, and will drop the price out a bit more for the aforementioned effect, and gain the advantage of having rave reviews for bang/buck categories. Lord knows those reviews don't fall off the internet...:twisted:
I shall abort this posting now lest my rambling overdrive engages and exhausts my logic reserves
--The loon