10-21-2002, 08:26 PM
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Executive Editor
Join Date: Aug 2006
Posts: 29,160
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Intel to Invest $150 Million in Wi-Fi Technology
http://story.news.yahoo.com/news?tmpl=story&ncid=581&e=1&cid=581&u=/nm/20021021/tc_nm/tech_intel_wireless_dc
Not that WiFi needed any help, but Intel is throwing some money into the ring to make sure the champ keeps swinging. What interests me most is the forthcoming Banias CPU with built-in support for WiFi. Cool.
"Intel Corp. said on Monday it plans to invest $150 million in companies developing high-speed wireless networking technology, an area of growth that Intel sees as key to accelerating revenue and profit in the coming years. Intel, the world's largest chipmaker, did not specify which companies it would invest in, or the time frame in which it would make the investments.
The most prevalent high-speed wireless technology standard used currently to connect PCs, laptops and handheld computers to each other and the Internet is known as Wi-Fi, or 802.11. Related to its push to spur the adoption Wi-Fi, Intel will introduce in the first half of next year its microprocessor chip code-named Banias, the first Intel has ever designed from scratch for mobile computing. Banias will include Wi-Fi capability as part of its chipset and processor technology, Intel has said." Source: Pete Paxton
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10-21-2002, 09:06 PM
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Intellectual
Join Date: Mar 2002
Posts: 248
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AMD
Here's a piece from Alan Abelson's column in Barron's this week.
Intel reported earnings, strictly on the skinny side, and, for one day at least, those pitiable profits knocked the wind shear out of the rally. Investors drew the glum but not erroneous conclusion from Intel's dismal report and downbeat forecast that high-tech was still in horrible shape. Analysts and amateur kibitzers were quick to diagnose the particular ills that Intel was prey to. Oddly, not many of them cited a problem that could cause it more than a small headache next year and beyond.
The problem is called Advanced Micro Devices, or more commonly among high-tech aficionados, AMD. We'll explain in a moment how AMD, which has roughly 20% of the processor market versus something close to 80% for Intel, spent $651 million on R&D last year versus Intel's $3.8 billion, had capital investment of $679 million versus Intel's $7.3 billion and had sales that were only a seventh of Intel's -- how this distant No 2, in short, can cause Intel big trouble.
The answer simply is in an AMD product called by the working moniker of Sledge Hammer (it'll be marketed as Opteron), to be introduced in the first half of next year, that gives AMD for the first time a shot at the lucrative server and workstation market, long dominated by Intel. More to the point, the Opteron is getting rave reviews in the trade, while Intel's competitive product, Itanium, already on the market, is proving a huge disappointment.
If this sounds familiar, it's probably because you read it in Rhonda Brammer's feature on AMD in August. The stock, then 7-plus, has been roughed up: It got as low as 3 and change before bouncing back last week to around 4.40. If she liked the shares at 7, she's got to love them at four, we reasoned, and urged her to revisit AMD. And, gracious as ever, she did.
Two things killed the stock in the month or two that followed her piece, she reports. The first was in mid-September, when the company announced that introduction of its Hammer chip for desktops (not the Sledge Hammer) would be delayed by a quarter, until late March-early April. Then, on Oct. 2, it forecast that sales in the third quarter would be some $500 million, instead of $600 million, and it would show a "substantial operating loss."
This revised melancholy forecast, Rhonda notes wryly, was on the money: On sales of $508 million, AMD lost $254 million. And worse, it burned cash at the rate of $300 million, compared with $200 million in the second quarter. That was enough to raise fears that the company might go belly-up.
But beneath the sorry surface, Rhonda found the third quarter actually wasn't all bad. For AMD refused to flinch and, instead, bit the bullet: It cleaned up its inventory channels, not only by holding off shipping new products but also by swapping new processors for old ones and eating the difference in cost.
Ex this cleaning out of inventory, she reckons, sales would have topped the expected $600 million and the loss would have been significantly less. But thanks to the purge (and continued brisk demand for flash memory used in cell phones), management is confident that revenues in the fourth quarter will rise a hefty 20% from the third and the red-ink will be noticeably narrower.
Moreover, vigorous cost cutting (not laid out in much detail) will, officials insist, progressively and sharply pare the loss in the next two quarters. Indeed, management says it'll break even in the second quarter of next year. Meanwhile, Rhonda observes, the company has beefed up its balance sheet by mortgaging a facility in Austin to the tune of $155 million. At the end of the quarter, it had $891 million, or $2.60 a share, in cash, enough, CFO Bob Rivet contends, to enable it to negotiate tech's tough times. Book value is $9.45 a share, or over twice the share price.
And, in any case, Rivet assures, "We could borrow another $300-500 million in high-yield debt." Little wonder, Rhonda chuckles, he bristles at the talk of AMD going under. In an unguarded moment, Rhonda says, Rivet allows as his stock is "an unbelievable bargain -- a screaming deal. Value players should be gobbling it up." She feels he's right, provided -- and it's no small proviso -- things go on schedule.
On that score, Rhonda relates, CEO Hector de J. Ruiz is supremely confident. He declares the schedule for Opteron (nee Sledge Hammer), aimed at the rich server and workstation market now dominated by Intel, has not slipped and will be shipped in the first half of '03. "It's out there," he says. "It's tested, it's real, customers love it. Nothing out there competes."
And, adds Rhonda, it is aimed at the business market, where demand for 64-bit technology is already keen and where customers willingly pay up for a state-of-the-art chip.
AMD, Rhonda sums up, remains an intriguing spec. An investor can lose virtually all his chips if things go wrong. But if things go right, the stock shapes up as a no-sweat triple or quadruple.
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10-21-2002, 09:47 PM
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Thinker
Join Date: Feb 2002
Posts: 384
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dedicated to ????
If Intel dedicated just $5 million of this $150 million on security, than maybe we could turn on Wi-Fi without worrying about intrusion and snooping.
On the Intel vs AMD thing. Intel majorly screwed up with the whole RAMBUS thing. Their big problem is they act as if people should by Intel JUST BECAUSE they are Intel. Of course, this STILL works on a LOT of buyers, but not all of them.
Performance wise AMD still delivers more bang for the buck. Going forward, thats where the real competition is. AMD still needs credibility in the notebook and server segments so that a company can reliably go all AMD across their offerings. If AMD can deliver as promised in the upcoming 64-bit CPU wars, they will make major inroads into the server segment.
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10-21-2002, 11:35 PM
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Intellectual
Join Date: Mar 2002
Posts: 248
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AMD
Agreed on AMD in the server and notebook mkt's. The Athlon has made huge inroads but I think it will be the Opteron that will be the determinant of their future. They made a mistake when they decided not to up the bus speed on the athlon. They implicitly admitted this when they announced the release of the Barton core but for now their proc's lag, though not in value. Given most of us aren;t even stretching our current proc's to their limit quite yet. Intel definitely has a degree of arrogance that comes with such prolonged and complete domination of a market. This is usually the downfall of a company in the longrun. (ie IBM, Rambus,) Nothing was sweeter than watching Rambus suffer and Micron counter their bully tactics. Still, the ppc market could use some more competition in my opinion on the hardware side.
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10-22-2002, 07:17 AM
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Thinker
Join Date: Feb 2002
Posts: 400
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Well to kinda take us back towards the thread here and away from the Intel bashing AMD crowd, Banias looks to be a really excellent CPU. It is going to be extremely low power with some nice built in goodies like Wi-Fi.
Now if we could just get those fuel cells working with the Banias CPU we could have a Handheld X86 with a realistic battery life. :lol:
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