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Another interesting challenge for intel (and AMD to a lesser extent). Between the share of compute moving to AI accelerator (and NVIDIA), and most cloud provide

Another interesting challenge for intel (and AMD to a lesser extent). Between the share of compute moving to AI accelerator (and NVIDIA), and most cloud provider having in house custom chip, I wonder how intel will positioned themselves in the next 5 to 10 years. Even if they could fab all of those chips, the margin between the fab business and CPU design is pretty drastic.

onlyrealcuzzo 3y ago
Doesn't TSMC just fab? They seem to be doing just fine.
- ethbr1 3y ago
  TSMC fabs leading node, and has consistently for several cycles now. So its margins probably benefit from a premium. If Intel can make their foundry business work and keep parity with TSMC, the net effect is that margins for leading node compress from the increased competition. And there's a lot of various US fab capacity coming online in 2024/5: https://www.tomshardware.com/news/new-us-fabs-everything-we-know https://www.tomshardware.com/news/new-us-fabs-everything-we-...
  - parasense 3y ago
    > the net effect is that margins for leading node compress from the increased competition. That is true in perfectly competetive markets, but I'm skeptical about that idea holding true for high-end chip nodes. I'm not sure there is enough competition with Intel joining the market alongside TSMC, Samsung, and all the other (currently) minor players in the high-end space. You might see a cartel form instead of a competative market place, which is a setup where the higher margin is protected. My best guess is the price will remain high, but the compression will happen around process yields. You could successfully argue that is the same as compressing margins, but then what happens after peak yield? Before prices compress, all the other compressable things must first squeeze.
    - onlyrealcuzzo 3y ago
      > You might see a cartel form instead of a competative market place, which is a setup where the higher margin is protected. Wouldn't it more likely be that players just carve out niches for themselves in the high-end space where they DON'T compete? If you're Intel - it seems like a fools errand to spend $50B to maybe take some of TSMC's customers. You'd probably rather spend $10B to create a new market - which although smaller - you can dominate, and might become a lot larger if you execute well.
      - ethbr1 3y ago
        I figured you'd see margin compression from the major, volume-limited buyers: e.g. Apple, Nvidia, etc. Paying a premium to get a quota with TSMC looks different, if there's competitive capacity, at least for large customers who can afford to retask their design teams to target a different process. Even if only as a credible stalking horse in pricing negotiations with TSMC.
hulitu 2y ago
> Another interesting challenge for intel (and AMD to a lesser extent). Are there any benchmarks comparing Threadripers and Xeons with this processor ?

onlyrealcuzzo 3y ago

Doesn't TSMC just fab? They seem to be doing just fine.

ethbr1 3y ago
TSMC fabs leading node, and has consistently for several cycles now. So its margins probably benefit from a premium. If Intel can make their foundry business work and keep parity with TSMC, the net effect is that margins for leading node compress from the increased competition. And there's a lot of various US fab capacity coming online in 2024/5: https://www.tomshardware.com/news/new-us-fabs-everything-we-know https://www.tomshardware.com/news/new-us-fabs-everything-we-...
- parasense 3y ago
  > the net effect is that margins for leading node compress from the increased competition. That is true in perfectly competetive markets, but I'm skeptical about that idea holding true for high-end chip nodes. I'm not sure there is enough competition with Intel joining the market alongside TSMC, Samsung, and all the other (currently) minor players in the high-end space. You might see a cartel form instead of a competative market place, which is a setup where the higher margin is protected. My best guess is the price will remain high, but the compression will happen around process yields. You could successfully argue that is the same as compressing margins, but then what happens after peak yield? Before prices compress, all the other compressable things must first squeeze.
  - onlyrealcuzzo 3y ago
    > You might see a cartel form instead of a competative market place, which is a setup where the higher margin is protected. Wouldn't it more likely be that players just carve out niches for themselves in the high-end space where they DON'T compete? If you're Intel - it seems like a fools errand to spend $50B to maybe take some of TSMC's customers. You'd probably rather spend $10B to create a new market - which although smaller - you can dominate, and might become a lot larger if you execute well.
    - ethbr1 3y ago
      I figured you'd see margin compression from the major, volume-limited buyers: e.g. Apple, Nvidia, etc. Paying a premium to get a quota with TSMC looks different, if there's competitive capacity, at least for large customers who can afford to retask their design teams to target a different process. Even if only as a credible stalking horse in pricing negotiations with TSMC.

hulitu 2y ago

> Another interesting challenge for intel (and AMD to a lesser extent). Are there any benchmarks comparing Threadripers and Xeons with this processor ?