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One retailer has initial pricing for the new AMD processors due to be out shortly.

Socket 939

Athlon 64 3800+ (Newcastle): $829.95
Athlon 64 3500+ (Newcastle): $580.95

Socket 754

Athlon 64 3700+ (Clawhammer): $818.95

Granted, these prices come from a place that tends to charge a lot anyway, and are inflated even more to suck out as much money from the wallets of those
who have to be the first to have one, but even making very generous assumptions, we’re looking at prices like $650 and $400 for the 3800/3700 and the 3500.

No wonder why AMD only expects to sell a handful of these systems this quarter.

Just imagine what a socket 939 FX will cost.

It’s Not The Price, It’s The Lack of Selection

I get a lot of emails from those who think I think that AMD shouldn’t charge high prices for their top of the line processors. Usually, they yell, “What about the Intel EE? Why don’t you scream about that?”

That’s not where I’m coming from. AMD (or Intel) can charge $800 or $8000 or $8000000 for its top-of-the-end processor for all I care.

It’s when they give me no choice but to pay $800 or $8000 or $8000000 to buy into what is supposed to be a mainstream platfrom that I object. Especially when it pretty much boils down to a rather perverse bait-and-switch.

The AMD roadmap for the next nine months will effectively work as follows:

Socket 939 will exist for at least the next three months as a placeholder to scare people into thinking that socket 754 systems aren’t too badly priced, so they’ll buy them instead.

Sometime very early in 2005, AMD will wave a magic wand, and all of a sudden, socket 754 will become AMD’s Celeron line, and suddenly, everyone is supposed to suddenly stop buying socket 754 and start buying socket 939 systems, leaving those suckered into socket 754 high and dry.

For the life of me, I cannot see why AMD would want to do this. There is virtually no difference between manufacturing a socket 754 and a socket 939 processor; per enabling dual-channel memory, it’s just a matter of enabling or disabling a circuit.

If I’m AMD, my future is going to be socket 939 Hammers, so I ought to try to get it established as quickly and best as I can within my manufacturing constraints. The way to do that is to offer lower-rated socket 939 processors at prices at least approaching mainstream prices ($280 wouldn’t be bad, $220 would be better).

Some may say that it is likely that AMD will slowly slip in lower-rated 939s as the year progresses, much as they did with socket 754s. That’s probably what they’re going to do.

However, there’s two new realities in today’s marketplace that didn’t exist with the socket 754s.

First, you have 90nm socket 939 processors coming. If you release an affordable 130nm 939 now, it’s a pretty safe bet that at least a few hundred thousand people will buy one now, and buy a 90nm 939 later.

If you don’t put one out until, say, December or January, odds are most of those potential early buyers will buy either nothing or top up an XP system and wait to buy the 90nm later.

Second, we now have the specter of dual-cores hanging over us. Make 939 somewhat affordable now, and most people aren’t going to be too deterred by some 2006 development. Make it affordable only a year from now, and 2006 prospects will become a greater deterrent, and God help AMD is Intel somehow manages to get a somewhat affordable 90nm dual-core by then.

If AMD were selling all the desktop Hammers they could make, all these arguments wouldn’t matter, but they aren’t. They can make over a million Hammers a quarter. If they actually were doing that, their CPU revenues would be at least $100 million a quarter more than they actually are. That’s almost a 20% increase, that’s not chump change.

To me, that’s money AMD is throwing out the window, for no apparently good reason, and when you add in Intel’s huge problems, it becomes even more inexplicable.

Rather than take advantage of Intel’s problems and give people a damn good alternative to Prescott and LGA 775, AMD is maniacally insisting that mainstream buyers buy a platform they’re going to obsolete in the blink of an eye.

Why?

At the very least, wouldn’t it make sense to give mainstream buyers a choice between the two and let the market decide what it prefers?

Again, we’re not talking about selling 3500+s for $100. We’re talking about selling a 3100+ 939 for $200.

What’s so radical or extreme or bad for AMD is that? From everything you, the audience, has said in surveys, the choice won’t be between paying $500 for a socket 939 or $190 for a socket 754. The overwhelming choice you’re making is either buying nothing or buying a $90 XP Mobile.

Wouldn’t it make more sense for AMD to get at least some of those paying $90 to pay $200 for a socket 939 instead?

Ed

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