Chapter 1403 – Ways of competition
Intel and AMD have an interesting relationship. Why are there rumors in Feng Yu’s previous life that Intel is the major shareholder of AMD?
Some former Intel Directors are on AMD’s Board of Directors, and some former AMD’s Directors are on Intel’s Board of Directors. Both companies even have an agreement to exchange technology patents.
Although both are making processors, their research directions are different.
If both parties can exchange technology patents, they can use new technologies on their processors. This will raise their standards compared to other semiconductor companies, forming a duopoly in the processor market.
Intel’s revenue was more than ten times AMD last year. AMD’s revenue was less than 4 billion USD, while Intel had almost 40 billion USD.
Although the PC industry is developing quickly and servers and workstations are expanding quickly, Intel’s market share has always been higher than AMD.
But Intel doesn’t dare to kill AMD because they will be sued for Antitrust and forced to break up.
That’s why Intel became a competitor and partner of AMD.
Both companies will compete for the market share. Intel has never used its influence to prevent AMD from getting orders.
Both companies cooperated on sharing their technologies to keep them in the lead. Of course, there are limitations to this agreement. Both parties will not authorize each other their core technologies.
In Feng Yu’s previous life, Intel and AMD are always suing each other for patent infringements.
AMD won most of the lawsuits and even got compensation of almost 1.5 billion USD once. That’s more than their annual profits.
Both parties will sue each other when the other party launched their new processor.
AMD had sued Intel because of cut-throat competition previously. This time, Intel is suing AMD for using the photograph taken during the competition for unfair competition.
But AMD doesn’t care. They had fought at least 80 to 100 lawsuits over the years, and their priority is to get the market share first.
Anyway, the lawsuits take a long time, especially between large companies. Microsoft’s lawsuit with the EU lasted over six to seven years.
When the odds of winning are low, their lawyers will ask for a private settlement. After that, their talks failed, and the lawsuits start again.
Of course, there are private settlements at times, but that will depend on the offers by the companies.
Many companies within the same industry are competitors and partners like AMD and Intel.
For example, Sony and AIWA in the early days. Both companies shared their technologies and sales channels to keep other competitors away from the Walkman market.
This cooperation ended after Feng Yu acquired AOWA. After years of development, AIWA had overtaken Sony in the music player industry.
Feng Yu had seen a lot of companies using despicable competition methods in his previous life. For example, an employee of a milk company accuses their competitor’s milk has issues and caused their sales to plunge.
Two beer companies were competing for the market share, and one of them got their salesmen to acquire their rival’s beer bottles. Beer bottles are recyclable items, and their rival’s bottling plant has a shortage of bottles for their production. The losses are several times more than normal competition methods.
The other beer company used this opportunity to increases their market share by increasing their production. Although they had spent a lot to acquire the other company’s bottles, they recovered the amount within a year after they got a higher market share.
Two home appliances companies held promotions in the same area, and their salesmen fought with each other. It was so serious that one of them died.
Two rival software companies used technologies in their software to stop each other. If you install my software, the other company’s software will be unusable. Both software cannot be used from the same PC.
There will be pop-ups indicating the other software is a virus and prompt the users to delete it. It caused inconveniences to the users, and some deleted one of the software. Others deleted both.
In the end, one of the software companies won because they have more loyal users. Both companies also reached for a private settlement, and one of the companies is Tencent.
Healthy competition among companies is based on products, prices, services, etc.
But some companies had adopted a “wolf” culture. It is either you or me. It is mainly the smaller companies that will adopt this culture. Which big corporation will dare to claim they can kill off their competitors?
It’s just you can find Pepsi in the same place where you can find Coca-Cola. You can always find KFC in the same place as MacDonald’s. They might be competitors, but they are also partnering in keeping other competitors out.
Feng Yu had asked AMD’s CEO, and he told him not to worry about it. They are used to being sued or suing Intel, and they will reach a private settlement soon.
During this period, both companies will race to see who can develop better technologies.
Regardless of the outcome, AMD’s market share will be more than 20% next year, and Intel’s market share will drop.
If AMD can develop a leading CPU, it will shorten their gap from Intel and reach more than 40% of the market share within five years.
When that happens, Intel can no longer belittled AMD.
Feng Yu met up with Liu Chuanzhi and the rest again to discuss the production of a new product.