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The market demand is for a cheaper processor. That the vendor is able to sell high end ones as lower ends (and volontarilly damaging them in the process...) and

by xilun0 16y ago

The market demand is for a cheaper processor. That the vendor is able to sell high end ones as lower ends (and volontarilly damaging them in the process...) and still getting a profit is a sign that they are artificially increasing prices by this trick and others, and while in a true free/perfect/unbiased/whatever market this kind of economical evil behavior (from the whole world/humankind point of view) would soon disappear thanks to the great idealized market, there is no such thing in the real world, especially not in the processor field, especially not in the x86 processor field. So the little Chinese kid will indeed get a kind of wiseness by learning that "in the great American Capitalist system, goods are damaged on purpose to fulfill the optimum of their system: [...] chip manufacturers damage their own goods on purpose. Why do they do this? Because the rules of American Capitalism dictate it." Because for the most part, that's the most unbiased view you can get. (But the rules of American Capitalism applies more and more to China too, so the little Chinese kid will either don't be taught that or learn soon enough that he will be part of the very same system regardless... (Not saying that real attempts to organize society by communism was better anyway))

dedward 16y ago
"artificially increasing prices" - if the market, which has heavy competition, will bear the price increase, then there is nothing artificial about it - prices are not a fixed amount - intel is free to sell every single chip at a different price if the market will bear it. Think of the logic. You want to produce a low end and a high end chip - because that's what the market is eating up. It's cheaper to have one fabrication process rather than two.... and suddenly, instead of busted, inferior chips being sold as lower end chips, we have the same chips in the same market niche, with the possibility of a simple software update to enable the high end features. It might smell funny at first, but as long as they are up-front about it, it's just business.
- wtallis 16y ago
  Do you honestly think that Intel is subject to "heavy competition" in the desktop CPU market? They have exactly one competitor (AMD), and because Intel is so much bigger and has so much more money, they always have newer and better fabs. The only ways AMD can be competitive with Intel are to be really daringly clever with their chip design (Athlon 64, and hopefully the upcoming Bobcat and Bulldozer cores), sell their chips at lower profit margins, take advantage of Intel's mistakes (Itanic vs Athlon 64), and to pick their battles wisely (AMD has never been able to field a whole product lineup that is competitive across the board). The barriers of entry to that market are so high that even AMD can't fully surmount them, and AMD definitely can't gain ground or even maintain solvency by doing what Intel does but slightly better.
nileshtrivedi 16y ago
But it doesn't cost Intel more to produce the high-end chip. In fact, maintaining two fabrication lines will cost more than producing a single chip and disabling the premium features. So I don't think "artificially increasing prices" applies here.

by xilun0 16y ago

dedward 16y ago

"artificially increasing prices" - if the market, which has heavy competition, will bear the price increase, then there is nothing artificial about it - prices are not a fixed amount - intel is free to sell every single chip at a different price if the market will bear it. Think of the logic. You want to produce a low end and a high end chip - because that's what the market is eating up. It's cheaper to have one fabrication process rather than two.... and suddenly, instead of busted, inferior chips being sold as lower end chips, we have the same chips in the same market niche, with the possibility of a simple software update to enable the high end features. It might smell funny at first, but as long as they are up-front about it, it's just business.

wtallis 16y ago
Do you honestly think that Intel is subject to "heavy competition" in the desktop CPU market? They have exactly one competitor (AMD), and because Intel is so much bigger and has so much more money, they always have newer and better fabs. The only ways AMD can be competitive with Intel are to be really daringly clever with their chip design (Athlon 64, and hopefully the upcoming Bobcat and Bulldozer cores), sell their chips at lower profit margins, take advantage of Intel's mistakes (Itanic vs Athlon 64), and to pick their battles wisely (AMD has never been able to field a whole product lineup that is competitive across the board). The barriers of entry to that market are so high that even AMD can't fully surmount them, and AMD definitely can't gain ground or even maintain solvency by doing what Intel does but slightly better.

nileshtrivedi 16y ago

But it doesn't cost Intel more to produce the high-end chip. In fact, maintaining two fabrication lines will cost more than producing a single chip and disabling the premium features. So I don't think "artificially increasing prices" applies here.