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Excuse my ignorence of the tech of this area. This is, to me, a leading company which is fighting to keep on the "bleeding edge" of the industry, but has a tremendous built-in base that provides cash (on the positive side) but also a "headwind" to taking the company in new directions.


Without a doubt, Intel is all you say but that is not the issue. The industry they serve is moving away from under them and "that" is the issue. It's not "who can replace them" as much as "who is serving the bleeding edge of the market" (mobile vs. desktop kind of thing). No one is going to replace Intel on the desktop but ARM has taken mobile by storm and Intel is playing catch up there.

There are two books that discuss these issues, Clayton Christensen's The Innovators Dilemma and Living on the Fault Line by Geoffrey Moore of Gorilla Game fame. In synopsis, when Intel was making 16/32 bit chips for PCs, ARM was making 8 bit chips for use in embedded applications such as disk drives, airbags and ABS brakes. For each x86 chip Intel sold ARM sold hundreds of 8 bit chips. Because many of the application were battery operated, power consumption was an important issue for ARM but back then all desktops were plugged into the wall socket so it was moot for Intel to conserve electricity -- the race was on for the fastest chip on the block competing with Motorola and IBM. The extra heat could be removed with a fan using even more power! While Intel was competing with Motorola and IBM making generic micro processors, ARM was competing with in-house designers using using ASIC chips and the like. ARM was absolutely no threat to Intel (as AMD tried to be) -- until Intel decided it wanted a share of the mobile market. By then the 97 pound weakling had put on some muscle! LOL

I have followed ARM for almost 15 years and I'm proud to say most of my predictions for the company have come true while disagreeing with industry experts such as Nick Tredennick and even ARM's management. Intel's future is probably best described by Geoffrey Moore in The Gorilla Game. Intel will be a cash cow as it slowly sinks into oblivion, it might take 10 or 20 years but that is its destiny. Moore was not talking specifically about Intel, that is how Gorillas die.

Denny Schlesinger

PS: While I have been right about ARM I have often been wrong about Intel on account of my bias toward the Mac. My favorite chip was the Motorola 680x0 which lost out to the Intel x86.

PS2: While developing a Desk Accessory for 680x0 Mac I found a way to double the memory it could use by changing the base address of the Mac address table.

The Innovator's Dilemma: The Revolutionary Book That Will Change the Way You Do Business by Clayton M. Christensen

Living on the Fault Line : Managing for Shareholder Value in the Age of the Internet by Geoffrey A. Moore

Nick Tredennick

Charles Atlas 97 pound weakling
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