On 6/29/05, Lewis declared: >My understanding of the numbers - Mac sells significantly less than 5% of >the cpus at this time. This can't to be that big a deal financially for >Intel. I am sure that Intel is very, very happy about Apple coming over >for lots of the reasons you mention but the least reason is financial (at >least directly).
On 6/29/05, chris declared: >So to Intel... Apple is really a loss leader. They use them to get the >new chips into the public eye, knowing full well they will be lucky if >they even break even on development with sales to Apple... but once Apple >gets them into the public eye... sales will take off as the other 95% of >the market decides this is the latest "must have" product..... > >.....Intel has lots of goodies sitting on the shelves of labs, waitng for >someone to get them into the public eye. Yes Apple needs Intel, but Intel >wanted Apple. Intel isn't going to make money off of Apple... Intel is >going to make money off all the stuff Apple makes "cool". I think we sometimes underestimate the impact of Apple's little market share, estimated variously at between 3% and 5% of the personal computer market worldwide. How nice it must actually be to control between 3% and 5% of a multi-billion dollar global market. If you review Apple's financial statements, you realize that Apple is HUGE, and it's market is HUGE. Just because the PC/Windows market is indescribably enormous does not make Apple's share insignificant. I'm not an expert on the subject of development costs, but I believe that Intel's development costs for Apple chips is not significant (especially insofar as Intel is already tooled for chip production and can use much, if not most, of the technology already in place for its PC chips) in comparison to how much revenue Intel will generate when Apple buys hundreds of thousands, if not millions, of units from Intel. CEOs sweat blood as they figure out how to increase their sales by 5%, 3%, 2%, even 1/2 of 1%. Each percentage point is a huge amount of money, and black ink is good. When AMD steals market share from Intel, and a little bit of red ink runs for awhile, stockholders get upset and profits go down. In my opinion, not only does Intel make good money off the chips it will sell to Apple, it also strengthens its market position by keeping AMD from getting the Apple contract. The fact that Intel will get the added benefit of being able to showcase its other products through its partnership with Apple is frosting on the cake, but let's not minimize the economic importance to Intel of its primary contract to provide CPUs for Apple computers. ---Jay ___________________________________________________________________________ To unsubscribe send a mail message with a SUBJECT line of "unsubscribe" to <[EMAIL PROTECTED]> or <[EMAIL PROTECTED]>
