David Kanter (dkanter.delete@this.realworldtech.com) on November 9, 2014 9:19 am wrote:
> Looking forward, I don't see Intel really stumbling the way they were around 2000-2005. They
> are tightly focused on servers and making smart moves. It's not obvious to me whether competitors
> can really make inroads across the whole market when Intel is executing well.
>
> I think the biggest hope for a competitor is to target a specific niche where they
> can out-execute Intel, since a big perf/power advantage will yield results.
>
In the early years of 2000, Intel's strategy made perfect sense at the time. Nowadays in hind sight we can easily say they executed poorly. Only in 2005 when AMD's cores start taking market share left and right, and when Intel was not able to ramp up Netburst to the envisioned clock rates, then it became obvious to them and the rest of the world something needed to change.

And although I agree with you Intel is executing with admirable precision, I see some weak spots in their armor that should allow the competition (basically ARM64) to gain a foot hold in most segments of the server market. E.g. HPC, low-end and midrange servers, etc. Basically everything except the absolute high-end is vulnerable.

1) Intel's current high margins on Xeon line is essential to maintain its growth. As traditional desktop / laptop PC market segment is inevitably slowing down, simply because most 3 year old PCs are still fast enough to do their jobs properly, Intel has little manouvering space to start a price war in the server space.

2) Intel does not seem very willing to move to SOC designs aggressively. Although I believe that would be the right choice from a density / cost perspective.

Another important factor outside Intel's control is ARM licencing model, which allows with a bucket of money to get a license, assemble a team, design a server SOC and bring it to market. So instead of competing against AMD in early 2000s, Intel will need to compete against several companies at a time. Some of these will fail, but those that survive will be the meanest and the leanest of the pack.

I believe the landscape has been changed. And old conclusions may not be applicable anymore. Although I expect Intel to remain the biggest fish in the pond, I do expect to see a more diversified and interesting server market in the upcoming years.

Ronald