Richard Cownie (tich.delete@this.pobox.com) on February 1, 2013 6:35 am wrote:
> anon (anon.delete@this.anon.com) on February 1, 2013 5:56 am wrote:
> > They have been trying with x86, not ARM yet.
>
> Which indicates that they don't have sufficient advantage from their
> non-cpu design expertise, plus their manufacturing, to make a dent
> in the market. Why would substituting ARM for x86 fix that ?

Their x86 cores in fact have not been very good. Perhaps they simply are not good at designing low power cores, regardless of ISA, you might say? Then they can just make Cortexes. That's what samsung is doing, and they have been at or near the front of the pack for significant periods.

> > You seem to be saying that other companies could make good profits, but Intel >inherently cannot.
>
> I think it's a big challenge to make good profits in the phone/tablet SoC
> market against the current, very competent, winners. Even for Intel.

I suspect it is far easier to make inroads than you think, if you have consistently superior SOCs. The Android market (80% of smartphone volume) is highly competitive. It's more like the PC/laptop market than the x86 CPU market.

> And apart from manufacturing, I don't think Intel's expertise is particularly
> well matched to that market. They haven't done much with SoC's; they haven't
> done much with handheld devices; they're not great at GPUs; they seem to
> operate on long-term product cycles which may not match the fast-moving
> mobile market (the same problem they had with GPUs).

Michael S addressed these.

> >
> > >
> > > > If x86 does not work out, they could design their own ARM cores, they could fab cortex cores like Samsung,
> > >
> > > There's more to a good phone/tablet SoC than the ARM cores.
> >
> > Yep, and Intel seems to be more than capable of producing such devices on a technical level today.
>
> I think they've demonstrated the ability to make something functional.

The point is that they have a pretty good phone SoC already, not just the cores as you seemed to imply. Presumably it will rapidly improve.

> They haven't demonstrated the ability to make something clearly superior.
> And "clearly superior", on some dimension, is what you need to grab
> market share from strong incumbents.

If it is not a jump from x86 to ARM, the margin required goes down significantly. Android smartphones are competitive, and if a competitor can save some money or have better battery life, they will.

>
> > Neither is *anything* in these ARM markets, for *any* player,
> > a way to get the kind of huge profits that x86 generates.
>
> Correction: that x86 used to generate. Last quarter Qualcomm alone made
> $1.9B profit; Intel made $2.5B. Not a big gap. And Intel's desktop/laptop
> business shrank a lot YoY (a gap which was partly made up by strong growth
> on the server side).

That's Intel-x86 vs Qualcomm, isn't it? Might as well compare IBM vs Qualcomm because IBM sells x86 servers. Do you have some *actual* numbers?

You can't take gross profit numbers from handsets for example and compare that to Intel's R&D, as if those vendors can just invest it all into AP design and logic mfg.

>
> > However it's growing of course, and every bit they take can add to their bottom line,
> > and take away from TSMC, or Samsung, or nvidia, etc. So the assertion that the ARM ecosystem
> > will grow to threaten Intel with no recourse for Intel to take is just flawed.
>
> Well, I started out on this thread with the suggestion that *either* ARM-based
> products would take server share, *or* Intel would have to cut server-product
> margins to fight them off. And either way would be a big change in the
> server business (and good for consumers). So I've accepted all along that Intel
> has "recourse to take" - it's just that the form of that "recourse" is a major
> restructuring into a business with lower margins in a more competitive market.

I read that a little differently than the post I first replied to, where you wrote

> What happens in the long term depends on economic forces (high volume tends to win)
> and on well-defended technical or legal obstacles (e.g. patents, software network
> effects). If x86 PC sales shrink significantly, while ARM-based products continue
> to boom, I'm not sure how Intel will maintain dominance.

Intel's dominance is manufacturing. If there is money to be made in ARM market, then in my opinion they have easy opportunities to sell silicon into that market. There is a good chance they will be able to do it better than anybody else, too.