Thursday, May 14, 2009

What if AMD went out of business?

There are a slue of lawsuits being filed back and forth between the major computer and video processor manufacturers. Intel's suing NVidia claiming that NVidia doesn't have the right to make VPUs that integrate with specific, Intel-patented processor assistant technologies. A company called Techsearch is suing Intel because Intel's hardware is based on an archaic model that was patented years ago by another company called International Meta Systems (IMS) that has since gone under, and whose patents were purchased by Techsearch. AMD is suing Intel on anti-trust charges, trying to convince the courts that Intel is trying to be anti-competitive and own the world's computing platform design. A few years back, Intel finally manufactured a processor that marginally outperformed AMD's equivalent processor, and since then, rumors of AMD's demise have circled the Internet and geek culture. Buzz has also been passed around saying that AMD has a real knock-out product in its future, a set of integrated processor-based technologies that will blow Intel back out of the water, but that they do not currently possess the R&D budget to complete it. AMD's ultimate failure is like waiting for a bomb to drop because it would mean Intel's monopolization of the PC hardware platform. I, like many others, do not want to see AMD go out of business, and not just because of what that means for Intel. AMD has consistently produced absolutely amazing processors. I've used AMD for years, and would not go back by choice. Even with the Phenom product line, advertised as a failure by Intel, and which consistenly have lower benchmark scores than the Intel Core 2 lineup, I chose the Phenom X4 to build my latest computer with. I did this because it was a full $100 cheaper than the Intel Core 2 Quad that I had been eyeballing with distaste, and the benchmark score disparity is really quite minor, if consistent. AMD has always provided their processors at a lower price than the Intel equivalent, despite that they have always benchmarked better right up until the Phenom line, and the "more for your dollar" principle has always applied. But what would happen if AMD crashed? Could it actually benefit the computer market in the long run? I know this sounds crazy, but hear me out. In this dystopian fantasy world, AMD goes under and Intel monopolizes the computer processor market. Intel will inevitably have anti-trust charges brought against them. After litigation takes place, some amount of reparation will happen, potentially benefitting the owner(s) of the AMD namesake and its operational facilities. But Intel cannot necessarily be forced into outright paying AMD to continue operation, so it's very likely that they might be forced into unlicensing the patent on the x86 architecture. Long story short, AMD has always licensed this architecture from Intel, paying them regularly to continue to be able to produce processor chips that will perform beneath the same operating systems that have been in place above the Wintel *cough* I mean Intel platform all this time. In this manner Intel has always profited from AMD's success. But if the license no longer cost money, AMD's total cost of operations would be severely reduced, and the market would also be opened up to other, more independent developers. That means competition (which was the point of this legislation in the first place), and that's always good. I would venture to say that I would stop buying AMD hardware if there were another competitor that produced better hardware at the same cost. This new processor market is definitely something that benefits everybody, since competition becomes more possible, and competition is the predecessor of innovation: hardware continues to get better at a faster rate. But do we really want to spend two or three years under the reign of a monopolistic Intel to get there? On the other hand, Intel would have to play their cards well during this proposed AMD downtime. The fear goes that Intel would own the market and jack up their prices. Having no alternative to their products, the market would be forced to pay more and more and more for the same crappy products they've always produced, only they might end up being crappier than ever before because of the lack of competition. Intel would be safe from consumer brand-switching. However, if Intel knows or thinks in advance about the possible legislative resurgence of AMD (or other competitors), they would be wise to not do this. AMD, despite their license payments, have always managed to keep their prices lower, so even if their resurgence into the market greets us at the same prices as before their failure, AMD will still appear to even better for the dollar than they do now in reality. Any other competitors would be at the same advantage. This might even lead to a cycle where Intel is doused and bounces back. Who knows, though? This is all just speculation on my part. In all reality, I want Intel to succeed. But only if AMD does as well. The competition is what keeps me able to build a system for $1000 that Dell sells for $4000. My prices stay low and I have a satisfying option. Live long and prosper, AMD.

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