On Wednesday AMD officially lifted the covers off the hardware platforms which are the basis of the new AMD laptops which were leaked numerous times in the prior weeks. The new platforms, referenced by the code names of Danube and Nile, are meant to respond to Intel’s impressive Mobile Core i3/i5 lineup which is now extremely common in mid-range laptop computers. That AMD would be compete in this segment isn’t surprising, but what is surprising is that AMD has been so successful in convincing manufacturers to base new products off AMD’s new designs.
In total, AMD has claimed 135 design wins. That’s a massive boost for AMD. I’m not sure of the exactly how many AMD laptops have been on the market previously, but this is definitely going to result in far more AMD products available on the market than normal. In fact, this may be the biggest mobile platform release in AMD’s history.
This begs the question – how? My initial reaction to the announcement that AMD has been able to earn 135 design wins was “Bwah?” Intel’s new Arrandale based Core i3 and Core i5 processors are perfect for laptop applications. They provide excellent performance, yet they are extremely energy efficient. As a result, laptops using Intel’s new processors have better battery life than most Core 2 based laptops and have better performance. The Turbo Boost feature on the mobile i5 processors, which allows them to automatically increase clock speed when usage permits, makes Intel’s products even more attractive.
However, product isn’t everything. Price is also important, and this is an area where Intel is currently at a major disadvantage. The Core i3 and i5 processors cost more than Core 2 processors anyway, and their prices have raised further as a result of limited supply. Intel can’t make processors fast enough, and as a result Intel’s mobile processors are rumored to be selling at up to 20% more than their contract bulk prices. In an industry which calculates the price of a laptop down to the penny this is a big deal. There is no room in the profit margin on a $500 dollar Core i3 laptop for a 20% increase in the processor’s price. This supply issue is probably a big part of why AMD has had so many design wins. Laptop makers need to have processors, and they need them to be reasonably priced.
Price also is likely working against Intel when it comes to marketing. Many of the new processors which are part of the Danube mobile platform are Phenom II processors with 3 or 4 cores. There is not doubt in my mind that, despite the higher number of cores, these processors cost a lot less than Intel’s Arrandale processors right now. Intel’s Core i3 and i5 processors are great, but they are all dual cores. Getting into bed with AMD gives laptop manufactures access to numerous inexpensive multi-core processors, and they like that. Having a Phenom II quad core label on an inexpensive laptop absolutely will move product. I can hear the Best Buy guy now – “Oh, you were looking for a better deal? Well, we have this AMD quad core model for the same price as that laptop with a Core i5. You’ll have double the cores for the same price!”
There is also a third, darker reason why AMD is getting so much business. Anti-trust lawsuits. Back in the bad old days of the late nineties and early naughties Intel aggressively pressured computer vendors into using Intel products. This was done through numerous methods including rebates which would evaporate if a vendor purchased too many AMD processors. It is hard to say if Intel has completely abandoned its former sketchy practices, but it is obvious they can’t be as overt as they once were. The European Union already fined them massively, and they have a case open in the United States. Intel has to be on its best behavior, leaving the door open for vendors to purchase as many AMD products as they damn well please.
In any case, and for whatever reasons, AMD’s design wins are good news for the company and the market. AMD has competitive products, and it needs to get the products out there so that consumers no longer think automatically about Intel whenever they think about computer hardware. The only question now is how well the laptops will review – we should be seeing the first batch of reviews within the next few weeks.