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June 05, 2005
Intel's Bad Trade
Posted by Dana Blankenhorn
Assuming Apple does switch to Intel chips tomorrow, as News.Com reports, the value of Intel stock will likely rise.
That would be a mistake.
Intel is making a big investment here to gain a very small amount of market share. Meanwhile it's losing far more market share to AMD in what used to be called the Windows world.
WinTel has been broken. That should be the real headline here.
Microsoft is perfectly happy to have AMD supply chips for Windows machines. People are very happy to buy them. And right now AMD has a price-performance advantage there.
This move toward Apple will, if anything, accelerate that shift. Intel should be spending all its time addressing its loss of share in the Windows world, and in the Linux world, instead of wasting energy with a tetchy, demanding Apple, an outfit that even IBM couldn't please.
One more point.
This is a business analysis, not a technology one.
I think Apple on Intel can result in some really great stuff. A close working relationship could result in great new specialty machines -- if the next iPod (iPic? iMovie?) runs Intel chips it would be great.
But Intel is losing a lot more than it's gaining here, from a financial standpoint.
Eventually investors will figure that out.
Comments (7)
+ TrackBacks (0) | Category: Business Strategy | Consumer Electronics | Investment | Moore's Lore
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1. MacBuddy on June 5, 2005 04:09 PM writes...
[Intel should be ...instead of wasting energy with a tetchy, demanding Apple, an outfit that even IBM couldn't please.]
Tetchy? Demanding? Are you implying that Apple has NO 'real' complaint with IBM?
It seems to me that everyone that is like you, thinks that Apple doesn't have the EXACT same complaint with IBM that it had with Motorola. These companies lead Apple to believe they can supply Apple with COMPETITIVE chips. Then they can't - or won't. Apple's plans go south. Apple gets the blame - by guys like you! But, maybe you're correct, Maybe it is Apple's fault that they are stupid enough to think they could TRUST their business partners.
Anyway, this essay is more 'I hate Apple' BULLSHIT. If you don't know that you are foolish. If you do know it, you are a LIAR.
Permalink to Comment2. Moxi on June 5, 2005 06:31 PM writes...
Hey Macbuddy,
Permalink to CommentI am a mac user too, but you are certainly not my buddy.
Mr. Blankenhorn has got a point of view. You are respectfully allowed to disagree with it. But I doubt that you know the meaning of the word "respect".
Your obscene language are making ordinary, regular folks hate all the rest of us mac users, and I tell you, we are quite a few "buddies" that are so fed up with types like you! Come to your senses, man!
3. renravd on June 5, 2005 08:33 PM writes...
It's unfortunate that MacBuddy worded his retort in such a way. However, he/she is correct.
Permalink to Comment4. Sriram on June 6, 2005 03:08 AM writes...
I'll beleive it when I see a press release on apple.com, this rumour is so cyclical that it's not even worth considering.
Permalink to Comment5. Brad Hutchings on June 6, 2005 04:04 AM writes...
Here's what you're missing Dana... I'm posting this before the keynote and I have no access to any inside information, so if I end up being spot on, it's because I know this technology, and if I end up looking clueless, it's because I know this technology :-).
The key to this whole thing is the AltiVec unit on PowerPC G4 and G5 chips. This is the vector instruction unit developed by Motorola and reluctantly implemented in the G5 by IBM. Programmers have to program specifically to it, and doing so is tedious work, but it can speed up graphic algorithms, like resizing, compositing, etc. by almost 4x at the same processor speeds. It is a simpler, better design than MMX, SSE, and other SIMD instruction sets in the x86 world, and yields much better performance when correctly programmed.
Apple has, of late, been moving a lot of their graphics libraries off to GPUs, but developers tend to be slow on the uptake because if they have cross-platform graphics apps, they will want consistency of graphic rendering each step of the way. So you don't offload your graphics routines to the operating system -- you do them yourself on operating system supplied bitmaps (which the OS can render on-screen or on-paper for you). And while Apple does supply a lot of great software out of the box (a lot more that Microsoft), the success of the platform still depends on third-party developers. The Mac is not referred to derogatorily as "iTunes-shell" the way Windows 3.x was called "Solitaire-shell". Anyway, there is a real market for cross-platform consistent graphics libraries right now, and I make a good deal of my earnings directly and indirectly from such a thing.
So coming back to AltiVec... Apple has realized that it may be able to do its on-screen magic with GPUs, but developers really want SIMD that they can program (or use 3rd party libraries) for their graphics operations. Apple partners with Intel and has Intel implement AltiVec on x86. The result is that professional graphics and publishing apps on Apple/Intel run faster than on Windows/AMD or Windows/Intel because Windows won't be able to embrace the AltiVec SIMD model as standard. Apple maintains its niche in pro-creative, and can consider expanding in the x86 space by offering an OS for non-Apple/Intel/AltiVec hardware. Many customers will pay a premium for Apple/Intel/AltiVec because some software will perform better on it than on Dell or HP boxes. The only downside I see in the cross-platform angle is CodeWarrior tools. Metrowerks is still a division of Motorola and is much more interested in embedded devices these days than in the desktop and was basically screwed by Apple in the Mac OS X transition after saving Apple's butt in the 68K-->PPC transition. There really has to be a third party x-platform tool-chain that is not based on GCC. OS vendor supplied (or maintained) development tools are like contaminated crack for the x-platform developer.
As for your Linux angle... Sigh. "On the desktop" (not talking servers now), Linux is Microsoft's battle against Microsoft's disaffected base. Mac users generally consider Windows to be just north of crap ("inelligant" and "unrefined" are adjectives that come to mind) and if they ever had to sit in front of a Linux box in a blind taste test, would consider it a cheap knock-off of Windows. Microsoft may have an increasingly difficult time differentiating Windows from Linux and justifying a price when competing with free. Apple, on the other hand, with the Mac running on essentially the same hardware platform, has a tremendous amount going for it out of the box compared to Linux for 95% of the population, and for all the important desktop market segments.
Permalink to Comment6. MacBuddy on June 7, 2005 01:54 PM writes...
117 words and you focus on one.
It's unfortunate that I felt compelled to use a word - one word - like that, to respond to yet another nonsensical swipe at Apple. APPLE IS NOT PERFECT. This is a concept that I understand. But, why do these 'journalists' always fall to the easy, unwarranted, jabs at Apple?
Why does the author feel that Apple is 'tetchy'? Why does the author feel that Apple can't be please - by anyone? Why does the author feel that Apple is demanding? None of these ideas were discussed. And none have thus far been answered.
My apologies to those that are too sensitive to read one of the lesser curse words. It is sad that I let my buttons be pushed. Two wrongs do not make a right. I could have taken up the challenge to choose any other word.
However, I too feel saddened, saddened that my 'message' was ignored by some. I just hope that I'm never on a sinking boat - with someone like you - where a raving madman is the only person warning us of our possible doom.
To those that 'got it', thanks. And thanks for the reminder on civility.
Permalink to Comment7. Bert Wiener on June 10, 2005 10:45 PM writes...
This move by Apple could really hurt MS. What if Apple starts selling its Intel-platform OS standalone. Much money can be made selling CDs for $100 per. And they have to develop/port the OS anyway. I'm not too technical but anyway here's my blog entry wrt this:
Permalink to Commenthttp://wienerville.blogspot.com/2005/06/apple-and-intel-sittin-in-tree.html