Let me just start with one man's saying "Real Men Have Fabs" 
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AMD thought that the reason Intel was able to beat them consistently was because Intel had their own fabs. I think that ironically, this is both true AND at the same time false.
If it were completely true, then AMD would have been able to equal Intel's product line .... but they didn't (mostly).
The REASON AMD couldn't make the vertical integration model work for them like it worked for Intel was because (IMO) Intel was able to amortize their considerable foundry investments across TONS more units. Intel was cash rich and was able to command a foundry lead over the entire industry... resulting in products that had great margins .... thus letting them continue to fund the foundry (which honestly, I consider to be the key to Intel's past success).
This was a business model created at a time when the majority of chips made in the world were made by Intel. I speculate that this fact is why the vertical integration worked so well for Intel for so long.
Fast forward to more recent history ......
New process nodes are exponentially more expensive to implement and are much more complex than those of the past. Ironically, Intel is making the same mistake (IMO) that AMD made all those years ago. They are trying to compete with a fab (TSMC) that makes nearly 2 times more wafers per year than Intel. This is a tough position for Intel IMO.
Another point to consider is Intel's risk taking in the foundry. Just like with 10nm, Intel's 18A is a very risky node IMO. Intel can't afford another 14++++ moment.
I believe that it would be in Intel's best interest to sell the fab to someone who could run it like a business instead of a cost center. The foundry can't be run "the Intel way". It needs to be run "the industry way" using common tools and processes. The foundry needs to become a world class service provider .... and that may well be a much bigger change than many imagine it to be.
Intel's design group is also in for an overhaul IMO. I think that they have long relied on the foundries industry leading processes to bolster their designs. For the first time with ARL we are able to analyze a leading edge Intel design against a leading edge AMD design (ARL vs. Zen 5) on process technologies that are well know relative to one another.... and honestly, it isn't very impressive for ARL IMO. ARL using N3B (the best of the best ... and most expensive TSMC has to offer) vs Zen 5 on N4P and Zen 5 nearly sweeps the field.
Finally, AMD has correctly adopted a "Server First" design approach that is greatly boosting their profits. Intel had dominated this high margin market for years and now, when that market is growing faster than ever, Intel has lost the leadership in this area to AMD (by quite a lot).
I am eager to hear your thoughts on my analysis.
. AMD thought that the reason Intel was able to beat them consistently was because Intel had their own fabs. I think that ironically, this is both true AND at the same time false.
If it were completely true, then AMD would have been able to equal Intel's product line .... but they didn't (mostly).
The REASON AMD couldn't make the vertical integration model work for them like it worked for Intel was because (IMO) Intel was able to amortize their considerable foundry investments across TONS more units. Intel was cash rich and was able to command a foundry lead over the entire industry... resulting in products that had great margins .... thus letting them continue to fund the foundry (which honestly, I consider to be the key to Intel's past success).
This was a business model created at a time when the majority of chips made in the world were made by Intel. I speculate that this fact is why the vertical integration worked so well for Intel for so long.
Fast forward to more recent history ......
New process nodes are exponentially more expensive to implement and are much more complex than those of the past. Ironically, Intel is making the same mistake (IMO) that AMD made all those years ago. They are trying to compete with a fab (TSMC) that makes nearly 2 times more wafers per year than Intel. This is a tough position for Intel IMO.
Another point to consider is Intel's risk taking in the foundry. Just like with 10nm, Intel's 18A is a very risky node IMO. Intel can't afford another 14++++ moment.
I believe that it would be in Intel's best interest to sell the fab to someone who could run it like a business instead of a cost center. The foundry can't be run "the Intel way". It needs to be run "the industry way" using common tools and processes. The foundry needs to become a world class service provider .... and that may well be a much bigger change than many imagine it to be.
Intel's design group is also in for an overhaul IMO. I think that they have long relied on the foundries industry leading processes to bolster their designs. For the first time with ARL we are able to analyze a leading edge Intel design against a leading edge AMD design (ARL vs. Zen 5) on process technologies that are well know relative to one another.... and honestly, it isn't very impressive for ARL IMO. ARL using N3B (the best of the best ... and most expensive TSMC has to offer) vs Zen 5 on N4P and Zen 5 nearly sweeps the field.
Finally, AMD has correctly adopted a "Server First" design approach that is greatly boosting their profits. Intel had dominated this high margin market for years and now, when that market is growing faster than ever, Intel has lost the leadership in this area to AMD (by quite a lot).
I am eager to hear your thoughts on my analysis.
