Intel Aims to Tighten Its Control of the Chip Market

Intel (INTC) is a tough competitor. Maybe not as ruthless as Microsoft (MSFT) was but they know many of the same plays.

For example recently Intel has taken steps to tell manufacturers that it will not "unbundle" their own 945 graphic chipsets from the Atom processor lineup. This has the fairly simple effect of locking out or making it very hard to justify a GPU from NVidea (NVDA) or AMD (AMD)/ATI (ATI) in any design.

Intel is obviously trying to control the market and ensure that Atom-based systems are useful but not too useful which they could be if other chips could be integrated into the design. Since it is a legitimate threat, one can understand Intel being concerned. But how about competing on features and price instead of using market power to block better solutions from other companies?

As the web enters a new phase of more visual, more mobile computing it’s going to be important for the market to have freedom in designing the right architectures for these new applications. Rather than lead the way, Intel seems to be keen to block innovation and eliminate those that try to compete on it.

We will always have a soft spot for Intel because they provided an educational grant to me when I was a kid to design S-100 CPU boards based on their then-new 8088 and 8086 designs. But this behavior is sad and hurts technology in general.

Disclosure: At the time of this writing we have a major emphasis on visual/mobile computing and a small position in NVDA shares.

Comments

[Fliujniligui:]

I agree with you. As an investor I own both INTC and NVDA shares. I think that the consumer is the ultimate picker, if he wants crap he will buy the intel offering and then judge if it is sufficient or not. Maybe that consumer will feel burned by the low performance offering of intel and he may then live with it, change it for an intel CPU + a GPU of luxury from ATI or NVDA or just remember that for the next time he shops a computer. The loser in this is not INTC, NVDA or AMD, it is the consumer.

2008 Dec 27 01:54 PM

[User 236804:]

Fliujniligui, why have you invested in INTC if you think their offerings are crap? Also, why would there be such a fuss about closing their 'crappy' platform? Obviously there is something that you do not understand.

2008 Dec 27 02:37 PM

[Smart1:]

Intel has categorically and publicly denied this claim. Besides that it is against the law, not something Intel would like to be involved in just now. I really don't understand why people report this completely unfounded information. I used to think if something was published by at least pseudo legitimate news service, it would be reasonably close to the truth. With the advent of the internet, apparently all of that is out the window.....

2008 Dec 27 05:46 PM

[george1173:]

Totally agree. There's no fact checking whatsoever. Just a bunch of podunk tech websites that spread a story around by referencing each other. The source is invariably a single dubious "article" by Digitimes or Fudzilla. After a few days the bloggers chime in and write a compelling narrative about ruthless monopolies or some such crap. Or course when the original claim is debunked nobody bothers to write a retraction or even do a little soul searching. They're too busy feeding on the next juicy rumor.


On Dec 27 05:46 PM Smart1 wrote:

> Intel has categorically and publicly denied this claim. Besides that
> it is against the law, not something Intel would like to be involved
> in just now. I really don't understand why people report this completely
> unfounded information. I used to think if something was published
> by at least pseudo legitimate news service, it would be reasonably
> close to the truth. With the advent of the internet, apparently all
> of that is out the window.....

2008 Dec 27 06:29 PM

[amdman:]

Intels sales terms are confidential. (secret)
The Atom uses the same bus Intel has used for a decade for its processors, so any of Intels chip sets could be used.

Intel has decided that Atom customers only want an obsolete crippled power wasting north bridge chip. A 20 watt north bridge is such a good choice for a 2.5 watt chip, this north bridge completely wastes the power advantage Atom was supposed to have, now the complete package draws the same power as VIA and low end AMD chips, while being slower than either.

Intel says that Atom pricing and leverage is not designed to put VIA out of business, so that VIA does not become another AMD. No these low prices are to create a new market for low power devices, opps, Atom with chip set is not low power...

Its just an accident that PC venders quotas are limited to 20% AMD chips, all these different volume discounts each vender gets are volume discounts, which are legal, not market share manipulation that is not legal... wink, wink, nudge, nudge...

2008 Dec 28 12:55 AM

[Kris Tuttle:]

Intel doth protest too much?


On Dec 27 05:46 PM Smart1 wrote:

> Intel has categorically and publicly denied this claim. Besides that
> it is against the law, not something Intel would like to be involved
> in just now. I really don't understand why people report this completely
> unfounded information. I used to think if something was published
> by at least pseudo legitimate news service, it would be reasonably
> close to the truth. With the advent of the internet, apparently all
> of that is out the window.....

Jan 02 03:22 AM