A Few Factoids . . . 2237

I came across this little webpage, which shows in a nutshell the David and Goliath nature of AMD vs. Intel.

A few numbers ought to enlighten:

Granted, some of you will look at this and say, “Well, DUH, Ed.” Sorry, and you’re excused from reading the rest of the article.

Unfortunately, many articles who’ll find these days are written by people who either are oblivious to these numbers, or expect that from their readers.

A lot of articles can make it sound like AMD and Intel are pretty much neck and neck, and in a few small niches, they are, but overall, Intel remains much bigger, not only because they sell more units, but because they get more money on average for each unit. AMD’s in better shape than they used to be in both areas, but they still have a long way to go.

There’s too many instances where authors confuse revenues and profits to be worth mentioning. It’s not what you take in that matters, it’s what you make from what you take in. If I started selling genuine ten dollar bills for eight dollars each, I could have more revenue than Walmart or Exxon/Mobil just like that, but I’d lose close to a hundred billion dollars to do so.

While Intel’s profits aren’t what they used to be, price wars and all, unless you’re doing Enron-style fraud, it’s pretty hard to go bankrupt when you’re making five billion dollars profit a year, no matter what this guy says.

Finally, you can see that Intel has many more employees than AMD, even after a staff reduction, so claims that Intel doesn’t have enough people to match AMD’s designs are . . . quite silly.

The truth is, in an industry built on megaindustrial centralization and economies of scale, size matters. It’s not a guarantee of eternal success, and it won’t save a Goliath from eons of ineptitude, but it helps success a lot and at least buys time to turn around a failure.

There’s one difference between the biblical and technical David and Goliath. Unlike the biblical David, who could take Goliath out with one shot from a safe distance, AMD can’t wipe out Intel with one shot (which is pretty much what they tried to do with Hammer). To just get even, the technical David would have to beat up Goliath for at least five years running. In this contest, Goliath can take a few headshots to get close enough to David for a little knife work, then wrestle David to the ground and sitting on him until he cries “Uncle.” That’s pretty much what Intel has been doing lately.

Ed