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Intel Corporation Message Board

  • intel_dividend intel_dividend Aug 15, 2012 6:19 PM Flag

    Discussion of one man's comment on Seeking Alpha

    This response below was posted by someone on SA. Thoughts? I like what I hear.



    The next generation of Atom will be here this year and be a completely different architecture. The medfield is a standard power, 32 nm part. The Atom part of the SoC is about 49 million transistors and probably take up the area of the head of a pin. When the low power 22nm new Atom comes with loads of other functions embedded. The price and power will beat anything fielded by TSMC which is, in fact, QCOM, NVDA, TI, and MRVL...One under capacity wafer source for all those guys....and one node and Trigate behind at that.
    When will the world figure out that all those companies funnel down into a single crippled source of wafers?

    Prices and margins:

    Using corporate gross margins, Qualcomm generates 67% gross margins an product built by TSMC. TSMC generates 45% gross margins on wafers sold to Qualcomm. using those numbers a $30 application processor sold by QCOM has QCOM cost of $9.90 and QCOM pays TSMC ~$5.44. That's an 82% gross margin for the fabless model. That same size chip (regardless of functionality) coming from Intel with 65% gross margins would cost the end customer $15,50. The whole margin argument with regard to Intel is BS. The fact is the functional equivalent to the $30 QCOM/TSMC part from Intel on 22nm would be half the size and about 65% of the $5.44 cost or about $3,50. If Intel had to, they could sell the function for $17.50 at 80% gross margins AND BE THE LOW COST SOLUTION!! How does any fabless company compete that?

    The Medfield could be viewed as a vehicle for debugging the supply chain and to determine whether there are any major functional issues with the SoC as it stands, before they add more functionality.

    The end point for smartphones will be a $100 cost device with uniform features that will sell for $200 without a contract. The phone will be display that will become very cheap, a case, a battery that will become cheap, and a "smartphone-on-a-chip" that will have to come from Intel. Just as Rimm and Nokia have had their guts ripped out by Apple and Samsung, those two might have their guts ripped out by....god know who. Think of calculators. Cellphones will all be smartphones and the only suppler to make any money on the whole industry will be Intel.

    BTW, The Intel Developers Conference is Sep 11-13. Paul Ottelini has done the opening keynote speech at every other IDC that I can find information on....not this one. Apple is rumored to have their iPhone 5 announcement on Sep 12. Coincidence? I recall Ottelini appearing on the Apple stage with Jobs wearing a fab "bunny suit" during the announcement of the change from Power PC to x86 chips. If Intel replaces the hated Samsung as the Apple AP supplier, what happens to Intel's stock price?

    I think the war turns out to be Apple/Intel vs. Samsung and the war ends with the $200 smartphone discussed above.

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