anon (anon.delete@this.anon.com) on February 1, 2013 9:36 am wrote:

> Well I believe it is you who do not understand. Their dominance is in manufacturing.
> They achieved that dominance in logic mfg with their x86 market, certainly. From there,
> they have been able to plunder much of the RISC and Unix server markets, which were
> absolutely not x86 dominated, and are actually notoriously adverse to change.

Well, not *that* adverse to change. The "RISC market" that Intel plundered from
1995 on didn't even exist in 1985. Change doesn't happen overnight, but it
certainly does happen over 5-10 years. And the increasing use of open-source
software has made it much easier to switch to a different ISA.

And for the relative importance of manufacturing vs design, you could look at
iAPX432 or i860 or Itanium, all products which had access to Intel's
manufacturing but either vanished without trace, or limped along without
ever establishing dominance.

> > Outside the desktop/laptop business - which is now shrinking - points a/b/c don't
> > apply. I don't think manufacturing excellence alone will allow Intel to dominate
> > other markets. You have a different opinion, evidently. We'll see.
>
> Neither did they apply in the server market.

Well, the "server market" is not uniform. The network effects are still going
to apply quite strongly to things like enterprise database software. But there's
a heck of a lot of "servers" running a Linux/Apache/MySQL/PHP stack, and none of
that is particular tied to x86 in the way that WindowsNT was (and my recollection
is that Linux was also mostly for x86 back in 1995-2000 - and also didn't
match the quality of proprietary Unix'es back then - though obviously these
days it's fine on ARM and just about anything else).

> The key is that the volume of silicon, and the revenue, needs to be large enough
> that it suits Intel's manufacturing model. That is: high spending on fixed costs
> in order to reduce the variable costs. Server market has this property.

Not really. 10M server cpu's a year is nice - and maybe those are 250mm2 each,
compared to 50mm2 for a phone/tablet chip. But the phone/tablet chips sell
in the hundreds of millions - so that's a bigger driver of manufacturing volume.

Intel does well so far because they've got about 85M units of desktop/laptop to
drive their volume. But that is a) not as much silicon as phone/tablet chips
and b) shrinking. The shrinking of Intel's core market, and the growth of the
phone/tablet market - in which Intel is not (yet) a significant player, are the
important trends.