Quote Originally Posted by highoctane View Post
AMD has reported a gross margin of around 50% for the last two quarters, the cheap chips can't be hurting them very much or this figure would be much lower.

The vast majority of the population using computers are not particularly interested in cpu performance. Whether AMD offers a $1000 high end chip isn't going to drastically impact their bottom line in the retail market simply because there are much less machines sold at that level in retail. If AMD can offer a solid product in the meat of the market they should be able to maintain their margins.

Just look at the success the ATI division has had with targeting the mainstream market with affordable performance while Nvidia was elephant hunting and had its sites on the big dollar enthusiast market.
If that was the case, AMD would not be losing money at the rate it is. It gross margins are undoubtedly worse than Intels.

I don't think T Flight was saying we need 1000 dollar chips. I think this is the implication of the 1000 dollar chip. When you can sell a consumer level chip at the 1000 dollar level and it will actually sell, that means you have technology that is cutting edge and derivative using the same technology will sell well enough to the mainstream or make a profitable lineup of chips.

AMD cannot produce a 1000 dollar consumer chip simply because its technology is not good enough. Considering the size of the company compared to the competition, it's no surprise.

AMD targetting the mainstream consumer has not been nearly as profitable as NV when they could charge what they wanted because they had no competition.