So the price and profit margins stay high.
Semiconductor factories hit the brakes to avoid heaps of unwanted chips piling up after demand for components shrank. Bean counter iSuppli reckons the major manufacturers acted swiftly to prevent expensive backlogs of baked silicon forming: the average number of days between producing inventory and selling it declined five per …
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I imagine it is not so much to avoid embarrassment as to avoid wasting money making stuff that will be obsolete before it sells.
There are some classic chips with unique uses that have long marketable life spans, but I think memory, laptop and desktop CPUs and chipsets are only marketable for maybe a year after they go into production.
Make much more than a year's supply and the surplus never sells.
"Make much more than a year's supply and the surplus never sells AT THE MARGINS INTEL WANTS" FTFY.
After all AMD is having no trouble selling Thubans and Athlons alongside the BD,Liano, and PD chips, but that is because they have such low prices that people don't care if its the latest and greatest or not. I should know as I still am selling quite a few Athlons and Phenom IIs and honestly folks couldn't be happier, I mean X6 for less than $130? Who doesn't like those prices?
But what Intel and AMD are seeing is NOT "the death of the PC", "The rise of mobile computing" or any of the other BS the press keeps coming up with, in fact its beyond simple. You see folks the MHz war? It was a BUBBLE, no different than the housing bubble or dotbomb or any other bubble. For that brief period of 94-06 you had both companies avoid looking at anything BUT Mhz, thus leading to an arms race with PCs that software designers took advantage of. People in that period really had no choice but replace every couple of years as new software simply wouldn't run on a 3 year old P2. My shop PC went from a 400MHz to a 2200MHz in less than 5 years, things were jumping THAT quickly.
What we are all seeing now is simply sanity returning to the landscape, because after both companies hit the thermal wall and switched to lower powered multicores instead of cranking out single core space heaters? Both Intel and AMD found out that software that scales with cores is REALLY hard to write. When the PCs I was selling on the low end 5 years ago was a Phenom triple with 4GB of RAM, how many folks are gonna need the latest core iWhatever when the jobs they have aren't even stressing that Phenom I?
So I don't see the sales coming back to bubble era numbers so shrinking will probably be the smart move in the long run but sales will continue, just in a more steady and less huge leaps in tech.
But that's exactly the point! Developers are finally getting around to polishing concurrency / parallelism on non-supercomputers, and it's taking a few years to hit the important qualifications, which are: 1.) Is the hardware there? (Who wants to put major effort into these designs if only 1% of your customers have multiple cores?), 2.) Is the software there? (Hyperthreading, whatever the hell is AMD's variant, etc. all profile slightly differently...when you throw in multiple real cores with half-cores, you really need a mature set of development tools).
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