Intel got envy of Nvidia and AMD's GPU shortages caused by BitMining, so they created their own shortage! Genius! Guess it's a new trend to create shortages and sell for more.

What is happening to PC Gaming? I really don't like this...

hey Hilbert, not quite the windfall for Intel as you hinted. most of the oem sales are case and tray prices to start with (at lower prices), it's Compal et al who are marking up the price to compensate for the loss of bulk. AMD is delighted because of the Xeon issues, just in time for Epyc and Ryzen Pro. Epyc was already forecasted to steal 5% in servers...looks to be much, much more considering lower power/ heat/ "moar" cores.

This will help AMD for sure and when Zen 2 / Ryzen 3 appears in 6 months or so, things will get even better for them. P.S. To AMD, please send me a Zen 2 engineering sample for me to try out (with motherboard) 😀

Madness.

tunejunky:

hey Hilbert, not quite the windfall for Intel as you hinted. most of the oem sales are case and tray prices to start with (at lower prices), it's Compal et al who are marking up the price to compensate for the loss of bulk. AMD is delighted because of the Xeon issues, just in time for Epyc and Ryzen Pro. Epyc was already forecasted to steal 5% in servers...looks to be much, much more considering lower power/ heat/ "moar" cores.

Maybe not but the fact that Intel has already all the production sold for the next year is already great news for them because having fabs at full capacity is essential. And because of the shortages they can sell with less discounts leading to higher prices and higher profits.

sverek:

Intel got envy of Nvidia and AMD's GPU shortages caused by BitMining, so they created their own shortage! Genius! Guess it's a new trend to create shortages and sell for more.

This^^

H83, you can shine my apples anytime you want. meaning (if not lost in translation), you are looking at a silver lining on dark clouds. everything you said is true, but lacks the important context of the market and Intel's reputation. and i love Intel (if not their management). this year, Intel became for the first time the second largest fabricator in the world. after almost inventing the category and leading it against all competition for decades. and only for the reason of bad management and lack of capital investment at the wrong time. the eight-ball they're behind is of their own making and being philosophically trapped by what had worked before. corporately, Intel is going through Kubler-Ross' diagnoses of loss. they are just out of denial and are progressing, but slowly.

Looks like Intel has provided an update on the supply situation: https://newsroom.intel.com/news-releases/supply-update/

Now for the challenge… The surprising return to PC TAM growth has put pressure on our factory network. We’re prioritizing the production of Intel® Xeon® and Intel® Core™ processors so that collectively we can serve the high-performance segments of the market. That said, supply is undoubtedly tight, particularly at the entry-level of the PC market. We continue to believe we will have at least the supply to meet the full-year revenue outlook we announced in July, which was $4.5 billion higher than our January expectations. To address this challenge, we’re taking the following actions: We are investing a record $15 billion in capital expenditures in 2018, up approximately $1 billion from the beginning of the year. We’re putting that $1 billion into our 14nm manufacturing sites in Oregon, Arizona, Ireland and Israel. This capital along with other efficiencies is increasing our supply to respond to your increased demand. We’re making progress with 10nm. Yields are improving and we continue to expect volume production in 2019. We are taking a customer-first approach. We’re working with your teams to align demand with available supply. You can expect us to stay close, listen, partner and keep you informed.

So basically, it's a checkmate for intel until 2020!?

cant wait for phone hardware shortages, and car shortages, who knows maybe even a plastic shortage, so credit cards and disposable forks get x68 pricing and so on, its a brilliant business strategy and thanks to the korean nand flash cartel everyone can now join in on the party

Certainly seems that way, started with ram and now everybody is like they got away with it, lets join in...

If 7nm Ryzen matches or beats Intel this is really bad news for Intel. In the past when this happened they stopped AMD by flooding the market with cheap processors through the major manufacturers. If Intel have no capacity this option won't be available. AMD need to strike while the iron is hot.

sverek:

Intel got envy of Nvidia and AMD's GPU shortages caused by BitMining, so they created their own shortage! Genius! Guess it's a new trend to create shortages and sell for more.

Pffft, amateurs. Hard disk manufacturers were at least a decade ahead of Intel/AMD/nVidia with their "shortages". After 1 Western Digital factory supposedly got flooded making them lose 0.012% of their stock and 0.01% of their manufacturing capability they literally tripled their prices, which were of course coordinated with Seagate and other manufacturers in order to make it possible. The prices remain inflated to this day. Western Digital knows what's up when it comes to illegal price fixing.

This is absolutely ridiculous. Where I live the mainstream Intel CPU prices went up 20-25% and the performance/dollar is skewed off badly in favor of AMD. At the moment Ryzen 1700 is the same price as i5 8400, only a gaming purist would go for Intel now.

At the end of the day, Intel can have or declare shortages and change their prices accordingly, as can all the resellers of their products. The market, personal and business, shall be what decides if any of this is a viable strategy in the long run. As long as AMD continues to put out a competitive product at an equivalent or better price point, they will eat into Intel's sales now, but also Intel will risk eating into their own rep and sales, which will create much more long term damage. Furthermore, Intel screwed themselves at their own game in the long term, and really flies in the face of that "customers first" approach in that open letter. The rapid changing in socket between generations does mean that if people are looking to upgrade anything, there is no real question around sticking to Intel CPU's to reduce overall cost, as they will likely need a whole new set of kit, which means that total cost of new system will make AMD a viable option where it otherwise might not have been if an upgrade path had been available. And lastly "You can expect us to stay close, listen, partner and keep you informed." - call me cynical, but last time they partnered up this closely they tried to illegally drive AMD out of the market with "rebates" and other unfair practices, and whilst they were caught the damage was already done. I would not be surprised if they tried to play the same game again, particularly as we saw Nvidia trying a similar tactic recently with their GPP program from an already leading dominant position. Seems there is little to deter companies in the dominant positions. $3 billion in fines is nothing when you make $20 billion in revenue a year from the end result of your practice.

wow...i really think it would be instructive for the board members at Intel to read this thread. chasing short term profits and taking the market for granted should never happen at the same time. and the market should never be taken for granted at all. there has to be some focus on the short term, just from the statistical standpoint. but overskewing the ROI (return on Investment) by cutting the investment leaves you open to what is happening now. and because of that Intel has zero capacity to flood the market with anything comparable to Ryzen+, let alone Ryzen 2. only a handful of Engineering fabs can make 14nm, only one is doing 10nm and is only making vapor. they've a crap ton of 22nm fabs, which is why those are now doing low end chipsets, with TSMC doing the high end chipsets (at 14nm). so yeah...they're fighting with one hand tied behind their back. whether or not oems trust them again after this cycle will remain to be seen. 10th gen Intel may well not be inside.

tunejunky:

H83, you can shine my apples anytime you want. meaning (if not lost in translation), you are looking at a silver lining on dark clouds. everything you said is true, but lacks the important context of the market and Intel's reputation. and i love Intel (if not their management). this year, Intel became for the first time the second largest fabricator in the world. after almost inventing the category and leading it against all competition for decades. and only for the reason of bad management and lack of capital investment at the wrong time. the eight-ball they're behind is of their own making and being philosophically trapped by what had worked before. corporately, Intel is going through Kubler-Ross' diagnoses of loss. they are just out of denial and are progressing, but slowly.

Yes! What's happening at Intel is not quite the result of "resting on its laurels", but more like the result of "resting on its presumed monopoly." In the old days Intel countered its lack of competitive products versus the Athlon/A64/Opteron by paying big vendors and OEMs lots of bucks to sell only Intel processors--and that was the last resort after having tried and failed to threaten motherboard OEMs in Taiwan with parts shortages and worse if they sold products that supported AMD cpus. Had the Taiwanese mboard OEMs not given Intel the bird and supported AMD, anyway, the history of AMD might never have amounted to much, imo. Dell, for instance, received staggering sums from Intel that literally kept Dell afloat through many quarters, as it was revealed during the AMD vs. Intel anti-trust suit. I was surprised as I had never in my wildest dreams thought the kickbacks Intel was providing Dell for being an exclusive Intel distributor amounted to what was revealed. Fast forward to now when AMD is emerging from its dark and rudderless period after having let its technical lead over Intel go by the wayside many years ago, and we see a fat and lethargic Intel so accustomed--again--to having no x86 cpu competition in the high end consumer and server markets that it never prepared itself for the resurgence of AMD, in particular. But what happened then cannot happen today, largely as a result of what was revealed in the AMD vs. Intel anti-trust settlement Intel initiated with AMD in which it paid AMD $1B in cash and signed agreements stipulating it would never again pay vendors or OEMs not to sell AMD products of any kind. I think that from now on AMD is going to have the R&D pedal to the metal in order to force Intel to actually earn its market share. What AMD has done in the past year is nothing short of astounding--Intel simply wasn't ready for it.

stupid human tricks part MCMLXXXVIII...Intel version. forgot to bring this up, but it's extremely relevant... Intel has been ramping up contract fabbing vs. their perceived (and not realized) declining pc market. the thing is, that isn't bad except when.... you are making more Apple modems @14nm than their own products. 85,000,000 to 100,000,000 14nm modems under contract just might be crimping their style. and yet, despite the knowledge of Apple's needs (that must be answered) and their knowledge of what it takes to launch a new generation of products, Intel chose to sit on their hands instead of recapitalizing their 22nm fabs to 14nm. just plain stupid and greedy. do the divisions even talk to each other?

tunejunky:

stupid human tricks part MCMLXXXVIII...Intel version. forgot to bring this up, but it's extremely relevant... Intel has been ramping up contract fabbing vs. their perceived (and not realized) declining pc market. the thing is, that isn't bad except when.... you are making more Apple modems @14nm than their own products. 85,000,000 to 100,000,000 14nm modems under contract just might be crimping their style. and yet, despite the knowledge of Apple's needs (that must be answered) and their knowledge of what it takes to launch a new generation of products, Intel chose to sit on their hands instead of recapitalizing their 22nm fabs to 14nm. just plain stupid and greedy. do the divisions even talk to each other?

I think it comes down to 10nm; if their 10nm tech was performing as planned then it wouldn't be an issue. It's understandable in a way - if they thought 10nm would be handling most of the load by now then there would be no reason to invest in more 14nm fabs. What this shortage shows is their absolute faith in their next-gen manufacturing technology. It's like someone putting a downpayment on their dream car before the holidays because they were confident that they would get a big Christmas bonus. That bonus didn't happen and so they're now facing a shortage. It really does show their hubris and arrogance.

D3M1G0D:

I think it comes down to 10nm; if their 10nm tech was performing as planned then it wouldn't be an issue. It's understandable in a way - if they thought 10nm would be handling most of the load by now then there would be no reason to invest in more 14nm fabs. What this shortage shows is their absolute faith in their next-gen manufacturing technology. It's like someone putting a downpayment on their dream car before the holidays because they were confident that they would get a big Christmas bonus. That bonus didn't happen and so they're now facing a shortage. It really does show their hubris and arrogance.

So, question is: how many dysfunctional 10nm factories they have? This would indicate planned capacity which they have no access to. I think that they did not build enough to start with.