2008 And Beyond

2007 is far from over but it seems that lately people prefer to talk about 2008. Perhaps this is because AMD is unlikely to get above 2.5Ghz with K10 and Penryn will only have a low volume of about 3%. I suppose this is not a lot to get excited about. So, we are encouraged to cast our gaze forward but what we see is not what we might expect.

AMD's server chip volume has dropped considerably since last year. So, there is little doubt that this trend will reverse in Q3 and Q4 of 2007 with Barcelona. This is true because even at lower clock speeds, Barcelona packs considerably more punch than K8 Opteron at similar power draw. The 2.0Ghz Q3 chips should replace around half of AMD's current Opterons and faster 2.5Ghz chips replacing even the fastest 3.0Ghz K8 Opterons in Q4. This should leave Intel with two faster server chip speeds in Q4 with this most likely falling to a single speed in Q1 08. However, Intel may be able to pull farther ahead in Q2 08. I'm sure this will be confusing to those who are comparing the Penryn launch with Woodcrest last year and assuming that the highest speed grades will be released right away. The problem with this view is that Penryn is leading 45nm in Q4 of this year whereas Woodcrest did not lead 65nm in 2006. Instead, Woodcrest was six months behind Presler which went into 65nm production in October 2005 and launched in December 2005. This explains why Woodcrest was able to hit the ground running and launch at 3.0Ghz. June 2006 was six months after 65nm Presler in December 2005. Taking this as the pattern for 45nm would mean top initial speeds wouldn't be available until Q2 2008. This seems true since Intel has been pretty quiet about Q1 08 release speeds. If the market expands in early 2008, Intel should get a boost as AMD feels the pinch in volume capacity caused by the scale down at FAB 30 and the increased die size of quad core K10. This combines with Intel's cost savings due to ramping 45nm to put Intel at its greatest advantage. However, by the end of 2008, this advantage will be gone and Intel won't see any new advantage until 2010 at the earliest.

To understand why Intel's window of advantage is so small you need to be aware of the differences in process introduction timelines, ramping speeds, base architecture speed, and changing die size advantages. A naiive assumption would be that: 1.) Intel's timeline maintains a process launch advantage over AMD, 2.) that Intel transitions processes faster, 3.) that Penryn is considerably faster than Conroe and that Nehalem is considerably faster than Penryn, and 4.) that Nehalem maintains Penryns's die size advantage. However, each of these assumptions would be incorrect.

1.) Timeline

Q2 06 - Woodcrest
Q3 07 – Barcelona Trailing by 5 quarters.

Q4 07 - Penryn
Q3 08 – Shanghai Trailing by 3 quarters.

Q4 08 - Nehalem
Q2 09 – Bulldozer Trailing by 2 quarters.

Q4 09 - Westmere
Q1 10 - 32nm Bulldozer Trailing by 1 quarter.

Intel's Tick Tock timeline is excellent but AMD's timeline steadily shortens Intel's lead over the next two and a half years. This essentially means that the dominance that C2D enjoyed for more than a year will not be repeated. I suppose it is possible that 45nm will be late but AMD continues to say that it is on track. The main reason I am inclined to believe them is the die size. When AMD moved to 90nm they only had a small shrink in die size at first and then they later had a second shrink. AMD only reduced Brisbane's die size to 70% and nine months later AMD could presumably do a second shrink. But they aren't; Barcelona shows the same 70% reduction as Brisbane. This suggests to me that AMD has skipped a second die shrink and is concentrating on the 45nm launch. I'm pretty certain that if 45nm were going to be late that we would be seeing another shrink of 65nm as a stopgap.


2.) Process Transition

Most people who talk about Intel's process development only know that Intel launches a process sooner than AMD. However, the amount of time it takes Intel to actually field a new process is also important. Let's look at Intel's 65nm history starting with an Intel Presentation concerning process technology. Page 2:

Announced shipping 65nm for revenue in October 2005

CPU shipment cross-over from 90nm to 65nm projected for Q3/06

And, from Intel's website, 65-Nanometer Technology:

Intel has been delivering 65nm processors in volume for over one year and in June 2006 reached the 90-65nm manufacturing "cross-over," meaning that Intel produced more than half of total mobile, desktop and server microprocessors using industry-leading 65nm process technology.

So, we can see that Intel did quite well and even beat its own projection by reaching crossover in late Q2 instead of Q3. October 2005 to June 2006 would be eight months to 50% conversion. For AMD, the INQ had a rumor for shipping in October and we know it officially launched December 5th 2006. Let's assume that this is true since it matches with Intel's October revenue shipping date with a December release in 2005. The AMD Q1 2007 Earnings Transcript from April 19th 2006 says:

100% of our fab 36 wafer starts are on 65 nanometer technology today

October 2006 to April 2007 would be 6 months. So, this would mean that AMD made a 100% transition in two months less than it took Intel to reach 50%. Intel's projection of 45nm is very similar with crossover not occuring until Q3 08. What this means is that even though Intel launches 45nm with a headstart in Q4 07, AMD should be completely caught up by Q1 09.


3.) Base Architecture Speed

Intel made grand claims of a 25% increase in gaming performance (40% faster for 3.33Ghz Penryn versus 2.93Ghz Kentsfield). However, according to Anandtech's Wolfdale vs. Conroe Performance review, Penryn is 4.81% faster while HKEPC gets 5.53% faster. A 5% speed increase is similar to what AMD got when it moved from 130nm to 90nm. The problem that I see is not with Intel's exageration but that Nehalem seems to use the same core. In fact, other than HyperThreading there seems to be no major changes to the core between Penryn and Nehalem. The main improvements with Nehalem seem to be external to the core like an Integrated Memory Controller, point to point communications, L3 cache, and enhanced power management. The real speed increases seem to come primarily from GPU processing and ATA instructions however like Hyperthreading these are not going to make for significant increases in general processing speed. And, since Westmere is the same core on 32nm this means no large general speed increases (aside from clock increases) for Intel processors until 2010 at the earliest. I suppose this then leaves the question of whether AMD will get a larger general speed increase with Bulldozer. Presumably if AMD can manage it they could then pull ahead of Nehalem. Both Intel and AMD are going to use GPU's on the die and both are going to go to more cores. Nehalem might get ahead of Shanghai since while both can do 8 cores Nehalem can also do HyperThreading. But Bulldozer moves back ahead again by allowing 16 actual cores. At the moment it is difficult to imagine a desktop application that could effectively use 8 cores, much less 16 but who knows how it will be in two years.


4.) Die Size

For AMD the goal is to get through the first half of 2008 because the game looks quite different toward the end of 2008. By the time Nehalem is released Intel will already have gotten most of the benefit of 45nm while AMD will only be starting. Intel will lose its small die size MCM advantage because Nehalem is a monolithic quad die like Barcelona. Intel only got a modest shrink of 25% on 45nm and so far has only gotten a 10% reduction in power draw so AMD can certainly stay in the game. It is also a certainty that Nehalem will have a larger die size than quad Penryn. This will be true because Nehalem will have to have both an Integrated Memory Controller and the point to point CSI interface. Nehalem will also add L3 cache. It would not be surprising if the Nehalem die is larger than AMD's Shanghai die. The one positive for Intel is that although yields will be worse with a monolithic die, their 45nm process should be mature by then. However, AMD has shown considerably faster process maturity so yields should be good on Shanghai in Q1 09 as well.

An Aside: AMD's True Importance

Finally, I have to say that AMD is far more important than many give them credit for. I recall a half-baked editorial by Ed Stroligo A World Without AMD where he claimed that nothing much would change if AMD were gone. This notion shows a staggering ignorance of Intel's history. The driving force behind Intel's advance from 8086 to Pentium was Motorola whose 68000 line was initially ahead. It had been Intel's intention all along to replace x86 and Intel first tried this back in 1981 with iAXP 432. It's segmented 16MB addressing looked pretty good compared to 8086's 1MB segmented addressing. However, it looked a lot worse than 68000's flat 16MB addressing which had been released the year before. The very next year iAXP 432 became the Gemini Project which then became the BiiN company. IAXP 432 continued in development with the goal of replacing x86 until 1989. However, this project could not keep up with the rapid pace of x86 as it struggled to keep up with each generation of 68000. When Biin finally folded, a stripped down version of iAXP 432 was released as the embedded i960 RISC processor. Interestingly, as the RISC effort ran into trouble Intel began working on VLIW and when BiiN folded in 1989 Intel released its first VLIW procesor, i860. HP began work on EPIC the same year and five years later, Intel was commited to EPIC VLIW as an x86 replacement.

In 1995 Intel introduced Pentium Pro to take on the established RISC processors and grab more share of the server market. The important point though is that there is no indication that Intel ever intended Pentium Pro to be used on the desktop. We can infer this for a couple of reasons. First, Itanium had been in development for a year when Pentium Pro was introduced and an Itanium release was expected in 1998. Second, with Motorola out of the way (68000 development ended with 68060 in 1994), Intel was not expecting any real competion on the desktop. AMD and Cyrix were still making copies of 80486 so Intel had only planned some modest upgrades to Pentium until Itanium was released. However, AMD released K5 which thoroughly stunned Intel. Although K5 was not that fast it did have a RISC core (courtesy of AMD's 29050 RISC processor) which put K5 in the same class as Pentium Pro and a generation ahead of Pentium. Somehow AMD had managed the impossible and had skipped the Pentium generation. So, Intel went to an emergency plan and two years later released a cost reduced version of Pentium Pro for the desktop, Pentium II. The two year timeline indicates that Intel was not working on a desktop version previous to K5's release. Clearly, we owe Pentium II to K5.

However, AMD purchased Nexgen and released the powerful K6 (which also had a RISC core) just two years later meaning that it arrived at the same time as PII. Once again Intel was forced to scramble and release PIII two years later. We owe PIII to K6. But, AMD had been hard at work on a K5 successor and with the added technology from K6 and some Alpha tech it released K7. Intel was even more shocked this time because K7 was a generation ahead of Pentium Pro. Intel was out of options so it was forced to release the experimental Williamette processor and then follow up with the improved Northwood two years later. We owe P4 to K7. That P4 was experiemental and never expected to be released is quite clear from the pipeline length. The Pentium Pro design had a 14 stage pipeline which was reduced to 10 stages in PII and PIII. Interestingly Itanium also used a 10 stage pipeline. However, P4's pipeline was even bigger than the original Pentium Pro's at 20 stages. Itanium II has an even shorter pipeline at 8 stages so it is clear that Intel does not prefer long pipelines. We can then see that P4 was an aberration caused by necessity and Prescott at 31 stages was a similar design of desperation. Without K8 there would be no Core 2 Duo today and without K10 there would be no Nehalem.

There is no doubt whatsoever that just as 8086's rapid advance against competition from Motorola 68000 stopped the iAXP 432 and shutdown Biin, Intel's necessity of advancing Pentium Pro rapidly on the desktop stopped Itanium. Intel already had experience with VLIW from i860 and would have delivered Merced on schedule in 1998. Given Itanium's speed it could have been viable at as little as 150Mhz. However, Pentium II was already at 450Mhz in 1998 with faster K7 and PIII speeds due the next year. The pace continued rapidly going from Pentium Pro's 150Mhz to PIII's 1.4Ghz. Itanium development simply could not keep up and the grand plans of 1997 for Itanium to become the dominant processor fell apart. The pace has been no less relentless since PIII and Itanium has been kept in a niche server market.

AMD is the sole reason why today Itanium is not the primary processor architecture. To suggest that nothing would change if AMD were gone is an extraordinary amount of self delusion. Intel would happily stop developing x86 and would put its efforts back into Itanium instead. The x86 line is also without any serious desktop replacement. Alpha, MIPS, and ARM stopped being contenders long ago. Power was the last real competitor but it fell out of the running when its desktop chips couldn't keep up and were dropped by Apple. This means that without AMD, Intel's sole competition for desktop processors is VIA. And, just how far behind is VIA? No AMD would mean higher prices and slower development and the eventual phase out of x86. Of course, I guess people can always hope that Intel has given up its goal of more than a quarter century of dropping the x86 line and moving the desktop to a completey proprietary platform.

2007: The Second Half

Amid all the rumblings and rumors there signs of fundamental differences between this year and last. In almost every aspect of processors AMD and Intel have swapped places. This has left a virtual vacuum of analogy for AMD and Intel supporters alike since both are reluctant to compare their favorite to the competition. The situation today is not exactly the same but some comparisons do provide a view of where things are likely to go.

We can add up the various ways that Intel and AMD have swapped places and there are quite a few. In early 2006, AMD's K8 was the undisputed leader ahead of Intel's Presler and Yonah offerings. Today, C2D is the undisputed leader ahead of AMD's Opteron and Athlon 64 offerings. In late 2006, Intel introduced quad core which AMD has taken nearly a year to match. Today, AMD is ready to offer native quad core which it will take Intel about a year to match. In early 2006, Intel previewed the native dual core 2.93Ghz Conroe which looked great and then it was a matter of waiting for Intel to actually get them out the door in volume. Today, AMD has previewed native quad core 3.0Ghz K10 which looks great and once again it is a matter of waiting for AMD to get them out the door in volume. In 2006, Intel was recovering from revenue shocks caused by AMD's K8. Today AMD is recovering from revenue shocks caused by Intel's C2D. In 2006, Intel introduced a new architecture that was far ahead of its previous generation offerings while AMD was only able to offer secondary upgrades such as small clock increases, virtualization, and faster memory speeds. Today, AMD is offering a new architecture that is far ahead of its previous generation offerings while Intel is only able to offer secondary upgrades such as small clock increases, SSE4, and faster bus speeds.

It really is remarkable how similar each company's situation is to its competitor's last year. This is most fundamentally true on the desktop. I suppose Intel supporters would point out that AMD is not likely to take the top performance spot in Q4 when Phenom is launched as Intel did when Conroe was launched. That is true. However, I suppose AMD supporters could point out that AMD was never in the heat and power crunch that Prescott was. Mobile is the most fundamentally different. Intel took mobile by storm when it launched the Centrino platform and since that time AMD has only been slowly chipping away with Turion. Merom was nearly the opposite of Conroe. While Conroe added tremendous value to the desktop as it replaced the sagging P4 line, Merom on the other hand actually had worse power draw than Yonah. Intel finds that having conquered the battery life and wireless LAN issue years ago that it has no place left to take mobile to gain an advantage. Turion has only had a small effect on Intel's mobile share but AMD should be fully competitive in 2008 with Griffin and Puma. It also looks like most of Intel's tweaks with Penryn are to try to stave off the coming attack from K10 Opteron. Intel is putting up a good fight with lower power draw, more cache, and faster FSB but it won't be enough. The fact is that when you've taken back as much server share as Intel has the only place left to go is down. SSE4 could be a big boost in HPC however Intel has already made most of its gains in the HPC low range with Woodcrest so Penryn would most likely be an upgrade to existing systems. SSE4 could be a boost in the top range but currently Intel has little presence there.

With Intel certain to have small losses in server share and no real change from the previous situation in mobile that leaves the desktop as the main battleground. AMD's average volume share in 2005 was 18% up noticeably from about 16.5% average for the previous several years. AMD's average volume share in 2006 was 23% and even though Intel has been fighting hard it remains at 23% in Q2 07. The actual price cuts have been a lot less than most people imagine. Intel's overall ASP is only down 16% from the nearly steady value of about $99 that it had been for three quarters. AMD's drop is similarly down 17% from the previous three quarter average of $60. AMD has had a desktop ASP drop of 42% since Q1 06 while Intel has dropped 38% in the same time. In Q2 07 AMD's desktop ASP was $49 versus Intel's $83. AMD's desktop ASP is substantially lower than Intel's but if it remains steady AMD will make more money as its margins improve with cost savings from 65nm. Although Intel's reorganization has so far only brought tiny changes in cost reduction it could see more in the 2H of 2007.

This does bring up the question of whether Intel will be able to bring additional price pressure to bear against AMD. Intel's Q2 07 earnings suggest that Intel reached its lower limit in pricing in Q2 and that it would need additional cost savings to be able to price lower. This plus the Q2 07 reductions in ASP for both server and mobile make it unlikely that we will see much in the way of lower prices during the rest of 2007. However, Intel is almost certain to resurrect this tactic in some fashion in 2008 as its ramping 45nm production reduces costs again. This should be interesting since AMD's ramping K10 desktop production should raise its desktop ASPs. It wouldn't surprise me to see a substantial bump of AMD's desktop ASP to $60 with a small cut of Intel's down to $79. This is possible if everything goes well and Intel still wants to keep prices down. Otherwise I would expect Intel to pull its desktop ASP back up to its preferred level of $99 and AMD to increase its to a preferred level of $70. This will likely be dependent on Intel's flash spin-off not being a $300 Million a quarter drain and AMD's new chipset division earning a profit. Mostly this means that Q4 07 will be more of a skirmish than the major battle that was expected. Presumably this will become a genuine battle in 2008 as Intel ramps Penryn while AMD ramps K10.

Some people seem to assume that Intel will ramp 45nm quickly and have large volumes available in 2007. However, the following ramp graph from Intel shows that 45nm will only be about 3% of production before the end of 2007. 45nm won't be a significant desktop volume for Intel until Q2 08 with crossover occuring the following quarter. Again, this why 2008 will be the real battle.

AMD: Limited Options

AMD trailed Intel's 65nm process by ten months in 2006 but the recent speed of conversion at FAB 36 has been impressive. Likewise, the announcement of only 2.0Ghz for Barcelona's release this quarter was disappointing. However, Fuad's article shows normal improvement for Barcelona with each stepping. This is good news because moving forward is really AMD's only option.

The microprocessor volume shares from the last seven years are interesting:

2000 - AMD 16.5%, Intel 83.5%
2001 - AMD 20.7%, Intel 79.3%
2002 - AMD 16.4%, Intel 83.6%
2003 - AMD 17.0%, Intel 83.0%
2004 - AMD 16.1%, Intel 83.9%
2005 - AMD 18.5%, Intel 81.5%
2006 - AMD 23.4%, Intel 76.6%
2007 - AMD 21.0%, Intel 79.0%

We can see that up to 2004, AMD averaged about 16.5% to Intel's 83.5%. AMD had a slight bump in 2001 during K7's competitive period against PIII and Williamette P4 but then dropped back down again in 2002 against Northwood P4. Some people mistakenly think that AMD's fortunes improved right after it released K8 in 2003. This was clearly not the case since AMD's volume share was lower in 2004 than it was in 2003. In 2004 Intel was on its 90nm process and gaining volume from 300mm FABs like FAB 11X and FAB 24 plus D1C which had been freed up for production by the new development FAB, D1D. AMD, in contrast, was expanding FAB 30 as fast as it could in the new clean room space and trying not to lose volume with a K8 die that was twice the size of the K7 die. This did not really come together for AMD until 2005 when the late 2004 move to AMD's own 90nm process allowed a much smaller die and the new expansion ultimately allowed a 50% increase in capacity. Ho weer, the 2006 numbers are misleading because the volume fell off from 2005. Without this dropoff, AMD's volume share would have been only around 19-20% since FAB 30 was topped out and the new production from FAB 36 did not arrive until the second half of 2006.

Some will no doubt see the latest numbers as just another bump like 2001. They will most likely assume that AMD will drop back down to its previous volume of 16%. However, that is not possible. There is a scene in the movie Vertical Limit where a woman has to jump from the tiny ledge she is standing on out into empty air and jam the crampon that is attached to her harness in a crack in the cliff face before she falls to her death. This is pretty much what AMD did when it built FAB 36 and purchased ATI. But, AMD had good reason for such a radical move. When AMD first introduced K7 and K8, Intel used its considerable muscle to prevent 3rd party companies from supporting them. Thus, no motherboard makers attended K8's launch and even companies like Acer were told not to attend. In both cases, AMD had to supply its own chipsets to get these platforms off the ground and there were still delays and areas not covered. For example, although AMD's K6 chip was capable of dual socket operation, there was no supporting chipset that allowed it. Likewise, AMD's 760 MP chipset was the only dual socket chipset produced for K7. Considering that K7's were used to build supercomputers, it would be difficult to suggest that the lack of other MP chipsets was due to K7 itself. Essentially, AMD's Dresden Design Center was able to produce a bare minimum chipset support for AMD's processors. However, this has inadequate compared to the much greater support that Intel provided to its processors. AMD only got out of this box by purchasing ATI. That AMD gained a much more robust capability to develop its own supporting infrastructure can be seen with the 690G, RD790, and 780M chipsets. AMD's choice was to either buy ATI and gain competitive support for its processors or die a slow death.

FAB 36 was also not much of a choice. Processor volume grows slowly most years at 3-11%. AMD did a very good job in increasing FAB 30's capacity by 50%. However expansion alone could not erase Intel's 300mm wafer advantage or prevent FAB 30 from eventually topping out. There was no doubt that AMD badly needed 300mm wafer facilities to remain competitive. It is theoretically possible that AMD could have added 300mm tooling to FAB 30 during its expansion in 2003 and 2004 and this would have reduced costs. However, FAB 30 would still have topped out and AMD would again be faced with the prospect of slipping every year in volume share until it became marginalized. For AMD, to not gain the necessary processor support nor to increase capacity meant marginalization and the eventual loss of any capability to compete in front line processors. AMD's ability to fund research and development would have slipped until AMD was like VIA is today or like AMD used to be before K6.

Unfortunately, neither of these could be done in stages or phased in. You can't really build 10% of a FAB nor can you buy 10% of a graphics company. This is why AMD had to take a leap out into empty air and hope it didn't plummet to the rocks below. I've seen some people try to lay the blame for AMD's financial troubles entirely on the ATI purchase. Seemingly, these people do not realize that AMD will spend $1.8 Billion in this year alone for tooling to outfit FAB 36; this is in addition to what it spent in 2006 and will spend in 2007 plus what the FAB itself originally cost. You can reasonably look at the issue either way. AMD could have easily afforded ATI if it hadn't built FAB 36 or AMD could easily have afforded FAB 36 if it hadn't bought ATI. Having to pay for both is what is difficult. I've wondered many times if there was any other option that could have gotten AMD out of the trap it was in. However, delaying the ATI purchase would have meant delayed benefit as well and AMD desperately needs the 780 mobile chipset that will come in 2008. Similarly, Fusion will not pay off until 2009 but, with Intel's moving in the same direction, pushing this back any further would have meant even greater competitive disadvantage to Intel. So, having built FAB 36 and bought ATI, AMD can now no longer survive on 16% of the market. AMD must move forward with at least 25% volume share or else it has no future.

That AMD intends to gain volume share is without question since in spite of the losses in Q4, Q1, and Q2 AMD's production plan is the same as it was in October 2005. AMD still plans to make 100 Million chips in 2008. This is more than double the number of chips that AMD made in 2005. However, the market is not growing that fast. The only way that AMD can sell 100 Million chips in 2008 is if it takes share from Intel. Naturally, Intel would prefer otherwise and will do its best to prevent this from happening. Looking at the volume share, one might easily think that nothing has changed over many years. However, this impression would be wrong. There has indeed been a strong dynamic element to the market even though Intel has garnered an advantage at each step. For example, Intel originally benefited by being ahead in terms of processor performance. This lasted until AMD introduced K6 in 1997. However, by that time Intel was making Pentium Pro and chipsets so it gained income from server and chipset sales that AMD couldn't match. It would be another four years before AMD released Athlon MP in 2001 and had a server processor offering of its own. However, with only a single chipset for support, Athlon MP never gained much marketshare and it would be another three years until AMD actually began taking server share in 2004 with K8.

By 2002 Intel had a steadily increasing advantage from 300mm wafer manufacturing compared to AMD's 200mm facility. AMD is only now benefiting from a majority of 300mm wafers in production. Likewise, it has only recently purchased ATI to gain stronger chipset support. Intel still has some advantages in mobile but these will essentially be gone in 2008 with AMD's new mobile platform. AMD will finally release a small volume of K10 server chips this quarter. In Q4, AMD should have more chipset offerings plus more K10 chips. However, Intel will begin releasing 45nm chips in Q4 and should hold onto the highest clock speed. It gets more interesting in Q1 08 because Intel will have a good volume of 45nm chips by then while AMD should have both faster K10 chips and a reasonable number of desktop K10 chips. On the face of it Intel could lose its speed advantages in Q1 08 but with 45nm ramping it should experience lower costs. AMD is unlikely to match 45nm until Q3 08. Intel's entire strategy seems to be based on lower cost 45nm chips plus low prices to put pressure on AMD. This was certainly effective up to now but may be less so as AMD's chip ratios move more strongly towards 65nm and 300mm wafers. Presumably, Intel swaps its 65nm to 90nm advantage for a 45nm to 65nm advantage. However, Intel does lose the 300mm advantage. This is a gain for AMD but then AMD hasn't made any profit for three quarters. The final factor though is that K10 should have more value versus Penryn than K8 did against Conroe.

With AMD's recent $1.5 Billion losses the notion of any gain for AMD seems counterintuitive. Yet if we list Intel's advantages:

Intel Chipsets – Declining as AMD moves forward with ATI
Intel mobile – Less than before, gone in 2008
300mm wafers – Declining rapidly, gone by 2008
65nm – Currently declining but will begin increasing again with 45nm in Q4
Quad core – Gone this quarter
C2D higher value – Declining once K10 is released, gone by Q2 08

So, except for the 45nm process, Intel is losing most of its advantages. This should make AMD much stronger by the start of 2008. Intel does still have Nehalem which could be a great processor and put Intel back in the lead. However, it looks like AMD may be better prepared this time with Shanghai than it was with K8. On the face of it I can't see any reason why AMD would not be able to gain share. And, since I've already shown that AMD has no middle ground it is a certainty that they will be striving their best to do just that. I think we will also find out conclusively in Q4 whether Intel has truly cut costs and leaned out the company. I think the last thing that Intel wants is to have a bad 4th quarter and they will have to have excellent cost control to maintain a price war with AMD in Q4. If AMD's only options are to gain share or go out of business we also have to look at who would lose if AMD failed. It's pretty obvious that neither IBM, Sun, Cray, HP, Dell, Gateway, nor Apple would be happy with the absence of AMD. Other than Intel, the only companies I can think of that would benefit might be VIA and possibly Silicon Graphics. With that number of companies benefiting from AMD the idea that it would go out of business soon does seem unrealistic.