Thursday, September 06, 2001

Intel to offer mid-quarter business update - Sep. 6, 2001

Without Intel rival AMD, computer prices would be a lot higher. While AMD only has 20% of the market, it's enough to make Intel drop prices on their processors to keep pace. Since AMD's chips are just as fast, if not faster, than Intel's chips, in many cases it would be foolish to spend more money on an Intel-based computer when you get no performance gain. However, Intel has solid contract agreements with the big boys: Dell, Gateway 2000, Compaq, and IBM. This makes it harder for AMD to increase their foothold.

The other problem is that I think we're getting closer to reaching a plateau in computer sales. Most people who want a computer now have one, and unless you're playing the latest games, you don't need the latest hardware, so a two or three year old computer still has enough horsepower to accomplish the basics. It seems to me that Microsoft and Intel are working in parallel to create a need for new computers; Microsoft keeps churning out new operating systems, and Intel keeps churning out faster processors (with AMD running alongside). However, consumers are starting to realize that they don't necessarily need a new operating system or a faster processor, and so the habit of buying a new computer every three years is not as iron-clad as it used to be. With the amazing technological advances in game consoles, gamers are turning to Playstation 2 and the upcoming Nintendo Gamecube and Microsoft X-Box to satisfy their needs instead of buying the latest video cards and processors for their PC.

What this means is that the computer industry will continue to slow down, at least from a home PC perspective. In the corporate world, business will still be booming for some time, as many companies space out their purchases over several years, and so they're always buying to replace outdated equipment. For the consumer, the best deal is still an AMD-based system, and if you're thinking of snagging a new PC, give AMD a chance. I did, and I'm very happy.


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