Friday, February 8th 2008

Dell to Stop Selling AMD Based Computers Online

For years, users wanted Dell to include AMD processors in Dell builds. In May 2006, Dell was happy to announce that they were bringing AMD on board. Everything seemed to be working out, until now. Dell recently announced that they're discontinuing almost all AMD-based Dell computers. The few ones that are left cannot be purchased online, and are only found in stores like Best Buy and Circuit City. This is likely to be a huge blow for AMD, and could not have come at a worse time. AMD recently posted abysmal revenue/loss figures for Q4 2007, and is running a company (ATI) that is worth 30% less than it was at the time of initial purchase. Hopefully, AMD will find more people to sell their processors.Source: DailyTech
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52 Comments on Dell to Stop Selling AMD Based Computers Online

#1
Paulieg
The Mad Moderator
by: zekrahminator
For years, users wanted Dell to include AMD processors in Dell builds. In May 2006, Dell was happy to announce that they were bringing AMD on board. Everything seemed to be working out, until now. Dell recently announced that they're discontinuing almost all AMD-based Dell computers. The few ones that are left cannot be purchased online, and are only found in stores like Best Buy and Circuit City. This is likely to be a huge blow for AMD, and could not have come at a worse time. AMD recently posted abysmal revenue/loss figures for Q4 2007, and is running a company (ATI) that is worth 30% less than it was at the time of initial purchase. Hopefully, AMD will find more people to sell their processors.

Source: DailyTech
Dell will regret this if it ends up contributing to the demise of AMD. Just like consumers, they will pay a higher price for Intel cpus when there is no competition. :mad:
Posted on Reply
#2
thoughtdisorder
by: Paulieg
Dell will regret this if it ends up contributing to the demise of AMD. Just like consumers, they will pay a higher price for Intel cpus when there is no competition. :mad:
+1. Excellent point Pauieg! Less competition=higher prices for all....
Posted on Reply
#3
jocksteeluk
Dell wont regret a thing, fact is the majority of the AMD systems Dell are currently selling are on discount because people right now know the AMD chips are inferior and the pro AMD fans didn't support AMD by purchasing Dell systems featuring AMD processors, Why should Dell stock something just to please some people who have no intention of buying the items? Dell like most capitalistic entities like to make profit and eliminate unnecessary costs and until AMD bring out a competitive processor AMD based dell systems will be and unnecessary cost to Dell to appease a few people.
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#4
mdm-adph
Considering they only started selling them in the first place because of A) the Intel-AMD Antitrust lawsuit and B) to get Intel to lower their prices, I'd say Dell is just doing what we'd thought they do all along.
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#5
jydie
Eh, I have never been a fan of Dell anyway. Dell has been behind HP for a while now... and guess what, HP/Compaq have sold both Intel and AMD based PCs for as long as I can remember. Intel may have better high end CPUs, but AMD has VERY affordable dual-core CPUs at the entry level. :)

Here is a recent post on Dell and HP:

Long-time electronics manufacturer Hewlett-Packard has been declared the most successful computer manufacturer of 2007.

According to figures released by Gartner, HP shipped 49.4 million computers worldwide during the past 12 months, an increase of 30% for the firm over its 2006 sales figures.

But Dell, once the darling of the PC world, saw its sales slow, shipping 38.7 million computers during 2007, a rise of just 1.7% over its 2006 figures.

The announcement shows that Hewlett-Packard now holds a record 18.2% of the worldwide PC market.
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#6
newtekie1
Semi-Retired Folder
by: Paulieg
Dell will regret this if it ends up contributing to the demise of AMD. Just like consumers, they will pay a higher price for Intel cpus when there is no competition. :mad:
AMD isn't going to go under, if they do fail and have to go in bankrupcy another company will buy them up. IBM is always looking for ways to get their foot in the x86 market, and buying AMD would certainly be a good way of doing it.

I'm not worried about there not being competition.
Posted on Reply
#7

Me :nutkick: DELL
#8
Co_Op
by: newtekie1
AMD isn't going to go under, if they do fail and have to go in bankrupcy another company will buy them up. IBM is always looking for ways to get their foot in the x86 market, and buying AMD would certainly be a good way of doing it.
Actually, no, that can't happen.
AMD and Intel signed a cross patent agreement back in 2001, so that AMD could make x86 processors. You can read it here:
http://overclockers.com/tips01276/
http://contracts.corporate.findlaw.com/agreements/amd/intel.license.2001.01.01.html

At 6.2 it says:
6.2. Termination for Cause.
---------------------

(a) A party may terminate the other party's rights and licenses
hereunder upon notice if the other party hereto commits a
material breach of this Agreement and does not correct such
breach within sixty (60) days after receiving written notice
complaining thereof. In the event of such termination, the
rights and licenses granted to the defaulting party shall
terminate, but the rights and licenses granted to the party
not in default shall survive such termination of this
Agreement subject to its continued compliance with the terms
and conditions of this Agreement.
(b) A party hereto may terminate this Agreement upon sixty (60)
days written notice of termination to the other party given at
any time upon or after:
(1) the filing by the other party of a petition in
bankruptcy or insolvency;
(2) any adjudication that the other party is bankrupt or
insolvent
;
(3) the filing by the other party of any petition or answer
seeking reorganization, readjustment or arrangement of
its business under any law relating to bankruptcy or
insolvency;

(4) the appointment of a receiver for all or substantially
all of the property of the other party
;
(5) the making by the other party of any assignment for the
benefit of creditors;

(6) the institution of any proceedings for the liquidation
or winding up of the other party's business or for the
termination of its corporate charter;
So, basicaly, if AMD goes bankrupt or is bought by someone else, Intel can say after 60 days: hold on a minute, you can't make processors anymore.
And who in they're right mind would buy AMD, if they could not make processors anymore?
Posted on Reply
#9
newtekie1
Semi-Retired Folder
IBM can and already has maded x86 processors, they don't need a licence from Intel(I believe they have their own already), so yes it can happen. The document isn't about x86 processors(x86 processors were around a long time before 2001), it is about technologies that have been patented since 2001. Which isn't a lot since the two companies have been using their own technologies, if anything it would hurt Intel to can the contract. One of the major technologies that document allows them to share is the x86-64 technology, a technology that was patented by AMD and Intel adopted. Intel wouldn't exactly be in a good possition if they ended the agreement and suddenly couldn't sell 64-bit processor, now would they?
Posted on Reply
#10
Co_Op
by: newtekie1
IBM can and already has maded x86 processors, they don't need a licence from Intel(I believe they have their own already), so yes it can happen. The document isn't about x86 processors(x86 processors were around a long time before 2001), it is about technologies that have been patented since 2001. Which isn't a lot since the two companies have been using their own technologies, if anything it would hurt Intel to can the contract. One of the major technologies that document allows them to share is the x86-64 technology, a technology that was patented by AMD and Intel adopted. Intel wouldn't exactly be in a good possition if they ended the agreement and suddenly couldn't sell 64-bit processor, now would they?
I suppose IBM can take over AMD, but that's just one buyer, if it's even interested. Regarding the rest, I'm not sure you're right.

I suppose AMD is giving Intel rights to use 64bit processors AND paying royalties, while Intel is giving AMD nothing... my, my, what a sweet deal.
4.3. Within ***** (*****) days of the end of each calendar quarter, AMD
shall pay the full amount of royalties due with respect to such
quarter to Intel by wire transfer for the account of Intel to *****,
or such other account as Intel may indicate from time to time. Along
with each such payment, AMD shall deliver to Intel a detailed
written royalty statement, in a form reasonably acceptable to Intel,
which shows the sum of the ***** each allowed deduction applied by
AMD to arrive at the ***** sold or otherwise disposed of, the
royalty rate in effect, and the total royalty due to Intel. All
royalty notices and reports shall be delivered to Intel at the
following address, until such address is changed by notice from
Intel:
Posted on Reply
#11
Paulieg
The Mad Moderator
by: jocksteeluk
Dell wont regret a thing, fact is the majority of the AMD systems Dell are currently selling are on discount because people right now know the AMD chips are inferior and the pro AMD fans didn't support AMD by purchasing Dell systems featuring AMD processors, Why should Dell stock something just to please some people who have no intention of buying the items? Dell like most capitalistic entities like to make profit and eliminate unnecessary costs and until AMD bring out a competitive processor AMD based dell systems will be and unnecessary cost to Dell to appease a few people.
I don't think that the average Dell consumer understands the difference b/t an Intel and AMD processor. Hell, half of my clients look at me cross eyed when I mention the word "processor"...:wtf:
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#13
newtekie1
Semi-Retired Folder
by: Co_Op
I suppose IBM can take over AMD, but that's just one buyer, if it's even interested. Regarding the rest, I'm not sure you're right.

I suppose AMD is giving Intel rights to use 64bit processors AND paying royalties, while Intel is giving AMD nothing... my, my, what a sweet deal.
Well, sort of. AMD has to pay royalties for the tech they use. AMD kind of got screwed on that contract. AMD has to pay royalties for anything they use, but Intel can use anything they want for free, it sucks but AMD had to do it. Which is why AMD isn't using a lot of tech from Intel(some SSE instruction sets, thats about it), AMD originally wanted Hyper-Threading, and was willing to pay for it and give up x86-64 to get it, but Hyper-Threading ended up being pretty useless to AMD.

If Intel was to void the contract, they would not be able to continue to produce 64-bit processors, not exactly a good thing for them.

This document isn't about x86, AMD has been free to use x86 since the 80s. Do you really think AMD had been using x86 since the 80s and Intel just finally got around to putting it on paper that they actually could twenty years later in 2001?
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#14
candle_86
they got an x86 license in 1981 because IBM needed a second manufacture for the 8086. The 2001 agreement covers SSE2, SSE3, x64 ect. And read it agian, if AMD breaks contract Intel still gets to use x64 but can inform AMD they can not.
Posted on Reply
#15
Co_Op
by: candle_86
If AMD breaks contract Intel still gets to use x64 but can inform AMD they can not.
Pwn3D!1!

If you're AMD, WTF do you sign such a contract?
Posted on Reply
#16
newtekie1
Semi-Retired Folder
by: candle_86
they got an x86 license in 1981 because IBM needed a second manufacture for the 8086. The 2001 agreement covers SSE2, SSE3, x64 ect. And read it agian, if AMD breaks contract Intel still gets to use x64 but can inform AMD they can not.
Why would AMD sign a contract that says that Intel can use AMD tech, and then tell AMD they can't use their own tech?
Posted on Reply
#17
candle_86
reread that contract, the tech is shared between both at this point, neither pays royalties to use it, they share it, and if one or the other breachs contract then the person breaking it is liable and has to stop using all shared tech.
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#18
happita
Hopefully AMD will profit in the near future and they won't need someone like Dell to be selling their processors in their pcs.
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#19
candle_86
they won't die, emachines and HP still use them, and a sempron is still better than a celeronL, and the x2 costs the same as the celeron 1200 and out preforms it also, so AMD will do fine in the budget sector just like in the K6 days.
Posted on Reply
#20
jydie
by: candle_86
they won't die, emachines and HP still use them, and a sempron is still better than a celeronL, and the x2 costs the same as the celeron 1200 and out preforms it also, so AMD will do fine in the budget sector just like in the K6 days.
Well said. I totally agree. :toast:

I think that AMD is in their norm right now. Sticking to the low to mid range area and selling products that offer "good bang for the buck". The few years that they were kicking Intel butt was actually out of their norm. Now, people expect them to stay up at that level... and say that AMD is in trouble because they can not make a high end CPU that will only sell to a small percentage of consumers that can afford it.

Seems that Nintendo has recently proved that selling a lower priced product can be more beneficial. The recent ATI HD3850 and HD3870 video cards also prove this point. I think AMD is doing fine and are back in their comfort zone. ;)

As for Dell... they may regret this move because AMD PCs typically sell for less... and people that just want a new PC are going to stick with the $400-$500 HP PCs instead of the more expensive Dell PCs.
Posted on Reply
#21

I would never by a Dell, even if it did come with an AMD cpu.
#22
pentastar111
by: candle_86
they won't die, emachines and HP still use them, and a sempron is still better than a celeronL, and the x2 costs the same as the celeron 1200 and out preforms it also, so AMD will do fine in the budget sector just like in the K6 days.
And lets not forget the recent Gateway deal...AMD will be alright without dell...dell/smell
Posted on Reply
#23
pepsi71ocean
by: TechnicalFreak
I would never by a Dell, even if it did come with an AMD cpu.
I second that, ive worked on dells and they just suck. If you want to do anything you are stuck, both ram slots filled, tight psu supply i can go on.


Shame that AMD lost a contract but that will punch dell in the stomach in 6 months.
Posted on Reply
#24
Kreij
Senior Monkey Moderator
I know that many of you do not like Dell, but Dell makes very reliable, inexpensive machines for business use. I have dozens on my networks and they last for years without even cleaning them.

Anyway, if Dell is dropping AMD it is from a pure profit reason. Dell is in business to make money. By the laws of the US, the BOD of Dell must try to make as much money as possible for their shareholders.

So, if AMD is not making them money, why would they continue to use them?
Posted on Reply
#25
asb2106
I dont love dell's, infact I barely think of them as good, but I have seen some real cheap computers come from them, most of the time - even cheaper than what I can build. They do stuff the computers with bad cooling and some weird HD mounting systems sometimes, but when all is said and done, for the average consumer they are just a computer.

And for them dropping AMD I see that affecting Dell more than AMD. AMDs run cool and are a great proc for the 400 - 800 dollar computer price range. Granted intel does have good parts there too, but the low end intel parts suffer from small cache and low clocks. I dont see it being that big of a deal, they didnt even sell AMD in retail did they?

I think AMD is gonna make some good cheap procs in the near future(tri-core phenoms) that will be cheap and very powerful, perfect for what Dell would need. I dont know if they are stopping for now or for good but I dont see this being a permenant change. Whoever is on top of the game will be supported by anyone who can get their hands on it. If AMD can succeed Dell will be back.
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