What do you think? Is Intel really in trouble?

[pm]

<< the people of Intel are heartless, they ploy the customer like puppets and they believe themselves to be the puppetmaster >>



Gee, thanks, BlackDragon.


Heartless:
I beg to differ. IMO (as a person who works there) the people of Intel are generally a nice group of people of diverse backgrounds. We contribute actively as employees and as a company to the United Way. We are, as a company and as employees, actively involved in the teaching of science and computers in school (we are the biggest contributor AFAIK to the National Science Fair program). We are actively involved in charitable projects in the communities that have Intel sites. I personally have participated in Habitat for Humanity, and some environmental work (fixing trails in parks and litter clean-up) through the charity groups at Intel. Intel regularly holds massive blood drives which gather wide support within the company.

Play with customer base:
No one that I know thinks that we play with our customer base. In fact, a good portion of my end-of-year bonus is tied to &quot;Vendor of Choice&quot;. This is a survey handed out to all of our OEM's and vendors. They vote whether or not we are their favorite supplier. In past years, this survey has come back in the mid to high 90's. Needless to say, it's quite bit lower lately (there's goes my bonus). But still, we have as recently as 2 years ago been voted by more than 90% of our customers to be their favorite company to deal with.

Puppetmaster:
And finally, if anyone at Intel thought that they were the puppetmaster, Intel's strategies in Direct RDRAM, graphics, SoC, and others should have shown them the light.

I read a lot on here about how Intel is about to crumble, and I rarely (if ever) comment. You guys are entitled to your opinions, and my are so biased that they probably aren't worth adding. But please don't make Intel out to be a company run by demons. We are, by and large, a generally nice group of people. It doesn't bother me to see someone say &quot;That's it with Intel, I'm buying AMD&quot;, but it does bother me to see &quot;Intel's a heartless beast full of self-serving egomaniacs&quot;.

For what it's worth, and without speaking on behalf of my company, I think it's good for both the industry and the customer for there to be solid competition in the marketplace for products. I think Intel has a pretty competitive product line in the low end, in the mid-range and especially in the low-end server and workstation market. I think we have a bright future. I feel with complete confidence that IA64 will be a long term success for the company (and for the industry) and that the Pentium IV will be a successful and competitive product. That's my opinion, anyway.

 

[yata]

Tell me what's wrong with greed?

What AMD lack is marketing department. Grove came about with &quot;Intel Inside&quot; and had it aggressively advertised. What has AMD done to reveal its image to the average consumer? Intel is far from being in trouble, provided it handles the mistakes as well as it has been. Who knows about the 1gig chip fiasco or the Rambus screwup anyways? AMD need some marketing flare to really spice their sales up. If not, there's no way it can gain any repectable market share from Intel.

 

[compuwiz1]

PM, I hope the rest of Intel is like you. You bring alot of class to the forum and are a good representative of Intel, even if &quot;Not speaking for Intel Corp.&quot;

 

[Finality]

I don't think they are in big trouble. They do produce more chips than AMD does but they just can't meet demand. Thats a bad thing?

 

[Killer Ape]

Patrick: As an aside, as an architect, it always makes me glad to hear of someone participating in Habitat (something I sorely need to do ). Actually , to get one's NCARB certification, 80 hours of community service is required. Many architects and designers choose Habitat and I'd encourage ALL AnandTechers to consider it.

Here's the link to Habitat

See all? We have our own Son of Chipzilla on this forum and he's one of our most esteemed colleagues.

I am in no way sucking-up to Intel, even though I keep begging PM to PM me that multiplier unlock hack...

Edit: Added link

 

[Cosmic_Horror]

well amd's athlon/thunderbird/duron success is really the first few seconds of the first round. They came out punching and got a few good hits in. Untill they get a much larger OEM base and lot more brand name recognition Intel will do just fine regardless of what they briong to the market place.

 

[pm]

Hulk: The Pentium IV has been in development for over 5 years. I remember when I was working on the Pentium co-workers would leave to join the Pentium IV development group. It definitely has not been rushed.

 

[realport]

yes. they should really move away from the rambus market they are really putting many consumers in regret. they should focuse on mainstream PC's they have the resources so they should be able to square it off with AMD.

 

[Sunner]

Dragon, do you think Intel is the biz to lveo its customers?
All corps like money, nothing else, and there's nothing wrong with that, the goal of ANY company is to make money.

If they need to be nice to make money they will, if they dont, they might just tell you to kiss their a$$es since it wont matter to them.

And pm, this is in no way intended to say that you or your coworkers are a$$holes(though I dont know them, but you seem like a very nice guy so Ill take your word for it).

 

[nergee]

Vrangel,
i'm not saying Intel has to make 288B in profit,
just look at the fundamentals of this company. With
the management they have in place and the products coming down the
pipeline, bear market or not, this company will make any investor
a lot of money down the road. Just let time work for you.
I only wish half of all companies were run this well and believe
me i've worked for a few dogs. Invest and Prosper.

 

[Syborg1211]

It may just come down to who has more resources. Intel has much more money than AMD and can invest a lot more into many more development groups. AMD is a pretty new company with fairly good resources but Intel may just keep on spitting out new processors faster than AMD. If AMD starts a marketing campaign and gets into other categories of computers, even in the server section, AMD may hold up for a long while.

Man, I wish I worked for Intel now though. They are giving EVERY one of their employees a new top of the line computer. My older sister works for them and she gets a P4 with 256 rambus ram and the works in Q2 of next year!

 

[seewhy]

Well, all company is in is for the money, so there is nothing wrong for Intel to be greedy. But I just feel that they have been doing it the wrong way. Intel used to be a solid technology and manufacturing company. But now, Intel seems to be run by bunch of marketing people and strategy consultant. Instead of focusing on introducing good solid products, they focus on doing stuff like moving to slot 1 to kill AMD compatibility, forcing people to pay premium on RDRAM platform if they want high performance, forcing people to use 810 &quot;Value&quot; chipset if they dont wanna pay for the high end platform, and reduce the performance of Celeron so that it won't kill the sales of P3.

So instead of coming out with best possible product, Intel try to play marketing game and try to force the market to eat what they handed to us. I guess diverting their resources and focus to Internet gears did not help in making better product either. While Internet is a hot and high growth industry, Intel is not perticularly good and famous in the playing field. There are many established players in that field and Intel will have hard time competing with CISCO and the like. So that strategy to help maintaining their revenue growth is questionable in my mind. But right now, the strategy sure is reducing the ability of Intel to be a top chip manufacturer.

So by not focusing their attention on their bred and butter product line to come up with a better product but instead use marketing game to play around with the customer, Intel has earned a bad reputation among knowledgable users. I guess regular consumer will be fool by Intel's marketing games and still buy their product. Plus AMD has limited capacity to take over Intel's market share, and their technology and platforms that support it are not mature enough in the eye of corporate users. So in the short term, AMD won't kill Intel. But if Intel doesn't change their way of doing business, soon AMD will come up with SMP platform, 64 bit CPU and will make some impact in higher end of business. By that time, Intel will have big trouble.

 

[Rigoletto]

I've seen salesmen at work and though we who read computer reviews and already built our own computer know that the P4 is v.poor value right now, joe public is just cannon fodder for the salesmen after all that intel bullshhit about internet experience etc. They'll use any number of scare stories and *misinformation on the public because they'll get higher commission on these expensive P4 systems. And to be honest, I wouldn't like to sell computers if I didn't get commission for it either.

 

[Whitedog]

&quot;Hulk: The Pentium IV has been in development for over 5 years. I remember when I was working on the Pentium co-workers would leave to join the Pentium IV development group. It definitely has not been rushed. &quot;

So the Piii was developed by the 486 Crew? hehe

 

[Vrangel]

Negree
I just wanted to point your attention to the fact
that INTC is overpriced. Fair value is around $10 IMO.
But of course it takes time for people to accept lower prices.
Thats what prolonged bear markets are all about.
Oh well, its your money...

 

[BlackDragon8303]

No I dont believe Intel is in the biz to love its customers, love and respect are 2 different things. I have been in the business world for a long time, trust me to be succesfull does not mean you have to forget about the customer. No personal offense to you PM at all I totally understand where your coming from where I work we are always offended and its hard not to take it personally, Intel will not die, it will lose its grasp on this market, correction it is, however this does not mean it will fall, I just wish Intel would have more of a customer POV like some other companies in this arena.

 

[Midnight Rambler]

<< If I was Intel I would take one in the family jewels and let other develop chipsets that support DDR without interference. In fact if I was intel I would make sure there were &quot;supply problems&quot; with the i850. >>

Their agreement with RAMBUST only requires that 20% of the total number of logic chipsets shipped support RAMBUST, in order for Intel to be able to exercise its options on RAMBUST. If RAMBUST stock keeps falling, Intel may be more and more inclined to shaft RAMBUST.


<< Very good points, Windogg. But, I think the main issue is that Intel is GREEDY and wants their sticky fingers in everything. >>

No, that is called diversifying the company - ever heard of a company called GE ... ? :Q Also, to add to Windogg's list, Intel is also expanding the server business in a big way, as well as making a major play in hosting (requires lots of servers, hey, what an idea! ).


<< if the economy continues to teeter in general, Intel may be in trouble, at least in the short term. But if it still has those vast cash reserves I keep hearing about (they gotta be down a bit thanks to AMD) >>

Are you proposing that AMD has stolen money from one of Intel's bank accounts or something, 'cause that is the only way possible for AMD to have affected Intel's cash reserves. Think about it. BTW, as of recent earnings, Intel had approx. $14.5 Billion in cash, plus another $6-6.5 Billion in equities and other holdings. It would take AMD about 20 years worth of record years like this one so far in order to amass what Intel has. Meanwhile, Intel generates about $34 Billion in revenues, about $7-8 Billion net, every year.


<< Pentium 4 being absolute cow dung, and now they are trying to make the customer spend more money on something that is misinterperting >>

Misinterpreting what? The product isn't even on the market yet.


<< What surprises me is that so many professional &quot;market gurus&quot; just woke up to this fact. WTF. Over? Dumb and dumber: AMD stock value is dragged down with Chipzilla's. I may not be as smart as I like to think, I don't have the dough to buy AMD common shares! >>

And that's why you're not a professional in the market ... AMD's stock was headed down long before Intel's warning, AMD was going down while Intel was headed to its all time high just a couple weeks or so before their warning. AMD's stock was downgraded and then headed down because of their loss in margins, due to their drastic price cutting. They try to bleed Intel to death, but it backfires.


<< I'm no expert in microprocessors but I do know that it takes quite a while to develop a next generation chip and get it to market in quantity. The P4 came about very suddenly and has a rushed air about it >>

Sure glad PM already answered this one, but any good hack ought to have known at least approximately how long Intel has been working on the PIV. Companies don't have long range business plans and forecasts just for the heck of it.


<< I just wanted to point your attention to the fact
that INTC is overpriced. Fair value is around $10 IMO.
But of course it takes time for people to accept lower prices.
Thats what prolonged bear markets are all about.
Oh well, its your money... >>

Right, and Cisco is worth about 50 cents, IBM only $3-4, GE only $7-8, etc. :Q Maybe if you had said something like JDS, or Juniper ...


PS. - I can't believe someone actually &quot;bumped&quot; their own post in a thread like this. Sheeeshh ...

 

[Vrangel]

Yes, its ten dollars my friend.Not that I have a particular
interest seeing it there. I am not short INTC or long AMD.
Of course there are more expensive stocks, like CIEN or
the ones you mention.They will come down even more.

Why is AMD down? Compare its chart with SOX.
They are identical. It means institutions have been
selling semis as a sector. AMD and everything.
INTC was spared for awhile because its ownership is
broader among institutions. Classic divergence when
secondary stocks crumble first and market leaders
are the last ones to collapse.

Money will continue to exit the market for the next few years.
And bulls are still in denial... Its gonna be a long story.