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Intel hopes to reach full production capacity after a two month delay

Just months ago at the 2011 Intel Developer Forum, executives with the world's largest traditional personal computer chipmaker, Intel Corp. (INTC) were all boast and bravado, saying their competitors were years behind in process.  Indeed, the talk about the dramatic gains in terms of power efficiency and clock speed using Intel's proprietary 22 nm FinFET 3D-transistor design sounded very impressive.

But the first chinks in the armor perhaps began to show at the 2012 Consumer Electronics Show, when Intel was caught faking its 22 nm Ivy Bridge DirectX 11 demo during its ultrabook pitch.  Intel brushed off the trickery, but the incident raised some serious questions.  If the 22 nm chip was launching in April at production volume and had already been taped out in final form, why would Intel have to use canned video?  Why couldn't it show its real product?  Why the obfuscation??

Well, DigiTimes is reporting that multiple OEM sources have shared that Ivy Bridge is being delayed from April to June.  While not a huge delay, the report raises questions about whether Intel's 22 nm process is as stable as it claims.

To be fair, the OEMs appear to be claiming that the delay is due to inventories:
Because most first-tier notebook vendors are having trouble digesting their Sandy Bridge notebook inventories due to the weak global economy, while Intel is also troubled by its Sandy Bridge processor inventory, the CPU giant plans to delay mass shipments of the new processors to minimize the impact, the sources noted.

In other words, PCs didn't sell well in 2011, Intel built up a surplus of CPUs, and so it wants to delay its release.  This is all very plausible, and indeed lines up with write-offs found in Intel's earnings reports.  

But it is also possible that Intel isn't being entirely forthcoming and that Ivy Bridge wasn't being delivered at the reliable high volumes it had hoped.  And it could very well be a bit of both factors -- too high inventories, and some struggles on the process front.

Regardless, it sounds like customers will have to wait on Ivy Bridge, a bit.

That's good news for the competition.  AMD hopes to aggressively roll out its Trinity accelerated processing units (APUs) later this year.  The chips are built on a 32 nm process (GlobalFoundries), but still aim to be competitive with Ivy Bridge in terms of power consumption and graphics performance.  AMD is gambling that the CPU will lose, processing speed-wise, to Ivy Bridge, but be "good enough" for most consumers.  

Trinity in the wild
AMD's Trinity APU (center) will launch later this year and aggressively target would-be Intel Ivy Bridge buyers by offering improved graphics and power efficiency at a lower price. [Image Source: Jason Mick/DailyTech]

AMD hopes to price its chip + chipset package at hundreds of dollars beneath Intel.  Where as Intel is targeting systems $700 and up, AMD has stated to us that Trinity systems will retail for $500 or less.  Strong 2011 APU sales of AMD's initial swing at this strategy made it look like a home run.

Likewise, ARM CPU makers, including Qualcomm, Inc. (QCOM) are looking to invade laptops and compact desktops late this year, with the introduction of 28 nm ARM CPUs compatible with Microsoft Corp.'s (MSFTnew Windows 8 [1][2][3][4][5][6].  The Q4 2012 devices are expected to follow a strategy similar to AMD's -- strong power efficiency at a low price.

The delay is also good news for third party USB 3.0 chipmakers like Renesas Electronics Corp. (TYO:6723), ASMedia Technology Inc., and Etron Ltd.  As Ivy Bridge was the first Intel chip to include on-die USB 3.0 support, it was expected to render these competitors' designs obsolete.  But now, they have been bought a bit more time.

Intel's core hope in terms of maintaining its dominant position is to beat the competition in process, and trickle down its process improvements into its budget models, mitigating cost and architectural disadvantages.  Intel has made big promises [1][2] regarding Atom-powered smartphones, but without 22 nm technology it appears to be forgoing any sort of big mobile push in 2012.  The longer it waits, the more advantage it gives to the hungry rivals.  Intel should hope that the delay does not set back its very aggressive 22 nm Atom rollout.

Sources: DigiTimes, MaximumPC [faked Intel Demo]

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RE: Lack of competition from AMD?
By TakinYourPoints on 2/17/2012 11:57:29 PM , Rating: 0
I disagree in regards to ultraslims, mainly because Intel already dominates laptops without dedicated graphics. Sandy Bridge has a surprisingly good IGP, Ivy Bridge is supposed to be a big improvement (200% improvement in 3D Mark GPU benchmark, WOW), and next year's Haswell IGP is supposed to be incredible. Hell, popular games like Starcraft 2, Team Fortress 2, League Of Legends (ugh), already run great on 13" SB ultraslims on low settings.

The problem is that gaming is generally not a priority for people that get those kinds of notebooks. If gamers want serious graphics, even with Haswell in the picture, they may still likely get a giant laptop with no battery life using a 680M or whatever is top of the line in a year.

Today's CPUs that go into ultraslims have more than enough power to run office and productivity applications, even things like video encoding reasonably well. This is well before we get into typical casual use (most of the population) with basic web browsing, media consumption, and email. "Good enough" is a big reason why ARM based tablets have nearly eliminated the netbook market. Taking all that into account, I don't know if the niche laptop gamer population (of which I am a part of) is enough to push AMD into the lead with ultraslims.

I'm not saying it is bad, I am saying that it is a number and a usage scenario that is relatively small.

The main thing that would turn this around is if Apple decided to go with AMD for their laptops. They are far and away the largest seller of ultraslim laptops, so taking that business away from Intel would be a major coup. I'm not sure it would happen simply because Intel can provide parts in much much greater volume, but we'll see.

Anyway, I have no doubt that AMD will get their piece of the dedicated GPU notebook market, but I have doubts about them taking the ultraslim market away from Intel.

RE: Lack of competition from AMD?
By Targon on 2/20/2012 8:17:49 AM , Rating: 3
A lot of the "Intel dominates laptops" is only because Intel has a huge presence in the mindset of many, not because people really have tested the machines side by side and have made a decision based on their needs.

Now, what sort of performance in real-world tests will Intel bring with Ivy Bridge? I don't care about select benchmarks, I am talking things like testing browsing speed under Firefox with Flash(there are a LOT of Flash apps out there). If AMD based machines are competitive in terms of price and offer other benefits, they will be fine. The A8 really does well in terms of heat dissipation in laptops, you don't burn yourself compared to the Intel machines which ALL feel like you would burn yourself if you let the machine sit on your lap for a few hours.

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