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AMD's chink in the armour revealed by Intel's FTC response

Posted on 20-01-2010

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Intel has filed a 25 page response to the FTC's anti-trust suit denying all charges laid at its door by AMD. And from the tone, it sounds like they are accusing the FTC of not knowing what entails the basics of procesor business. But what's more interesting is some of AMD's inner working over the past decade have been revelaed. The document quotes the then AMD marketing chief, Henri Richard who has made some shocking comments in an internal memo --

"[I]f you look at it, with an objective set of eyes, you would never buy AMD. I certainly would never buy AMD for a personal system if wasn't working here," Mr. Richard allegedly declared to his fellow AMDers. He apparently went on to characterize AMD as "pathetic" for "selling processors rather than platforms and exposing a partial story, particularly in the commercial segment, that is clearly inferior to Intel's, if we want to be honest with ourselves."

And then the final nail in the coffin, “AMD's products have a reputation as a cheap, less reliable, lower quality consumer type product." These were Richard's view back in 2004 when AMD was doing very well for itself, which makes one question Richard's perspective and more so the in-action by the management against Richard for voicing such damning sentiments.

Then comes the question of relevance of these documents. In 2004, AMD was the King with superior processors and even lead the Enterprise category. But later began the downward slide, first losing out the enthusiast market and then finally the enterprise market. It was not like the engineering brains at AMD, who once schooled the boys at Intel, were not upto task. This makes one question and puts focus on AMD's managerial and marketing capabilty. When the company's own marketing chief has distrust in the company's products and advises against using them, there is something seriously wrong.

By citing these documents, Intel clealry is hinting at the AMD's managerial and marketing incompetence which led to reduced market share and the following losses. But is it enough to let Intel off the hook?