Six Million For 2004


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Six Million For 2004 . . .

XbitLabs reports that AMD will make slightly less than six million desktop Hammers in 2004. All of 2004.

Just to put that number in perspective, total AMD CPU production is a bit over thirty million CPUs in a year.

What does this mean? If these numbers are accurate, that means Hammer won’t become AMD’s mainstream processor until 2005. For practical purposes, Hammer will be introduced into the CPU mainstream at 90nm. These 130nm CPUs are just a prequel to the main event.

What will that mean for you? In all likelihood, it means the kind of high prices we projected the other day for most of 2004.

Why Aren’t They Making More?

AMD is going to have a very odd product mix in 2004. They will either charge an arm and a leg for a processor, or practically give them away with the cornflakes.

And they’re giving priority to the ones they’re practically giving away with the cornflakes.

Imagine someone telling you, “Hmmmm, I can make expensive processors that will give me a big profit, and I can make cheap processors I break even or lose money on. I’d much rather make mostly cheap processors.”

Would anyone sane willingly do that if he really had a free choice in the matter?

Don’t tell me anything about how expensive A64s are to make. Yes, the ones with 1Mb cache do chew up a lot of die space, but what about the ones with 512K? That’s no more cache than a Barton, and AMD isn’t complaining about selling those for $90.

AMD is effectively saying to overclockers, “Give us $400 or give us $50/$90.” Would it not make far more sense to give them a $200 option, and get $200 sales rather than $50/90? AMD would certainly make money from that. The overclocker buying that would most probably buy a 90nm processor in a year’s time, and has effectively committed to the Hammer platform by that $200 sale.

Well, yes, AMD is providing a $200 option, an Athlon 3000+. But what do they do? They trash their own option for the performance people by telling people that it’s going to be downgraded and sent to the bargain basement by the last quarter of the year.

What are these people doing?

Not even I can believe the corporate execs at AMD are quite this stupid/incompetent. Circumstances must be forcing them into this approach. We pointed out a number of possibilities why this might be the other day.

Whatever the exact reasons may be, for practical purposes Hammer has been delayed as AMD’s mainstream processor for at least another six months.

$400 . . . Later…

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