Friday, November 16th 2018

Intel Cutting Retail Processor Supply for Holiday 2018

Prices of retail packages of Intel Core desktop processors could continue to rise over Q4-2018, as the company has reportedly cut their supply, in favor of tray/reel shipments to OEMs. This could mean DIY favorites such as the Core i5-8400, the i5-8600K, i5-9600K, or even Core i7 models such as the i7-8700K, i7-9700K, and the flagship i9-9900K could be severely in short supply, or heavily marked up wherever available. Intel recently devised a strategy to increase its Core processor volumes by pumping in an additional $1 billion to its usually-$15 billion capital expenditure, to fire up small-scale manufacturing facilities around the world, to augment its bigger fabs located in Malaysia and Vietnam.

Sites like Mexico, Israel, and Ireland are beneficiaries of this move, and are being expanded. Much of Intel's efforts appear to be focused on making sure notebook and pre-built PC manufacturers aren't starved of processor inventory. The DIY retail channel, which consists of boxed processors, will foot the bill for this move. A good example of understocked retail channel would be the $499 Core i9-9900K processor being sold for upwards of $900 in some online stores. AMD is in an enviable position to fill the void, comments PCGamesN. Prices of its Ryzen desktop processor PIBs are either flat, or marginally cut; and socket AM4 motherboards are generally cheaper than LGA1151 ones.
Sources: PCGamesN, DigiTimes
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106 Comments on Intel Cutting Retail Processor Supply for Holiday 2018

#76
Batou1986
R0H1TWe're talking mainly about enterprise & high end CPUs to OEM, so what you're saying is BS. Do you actually think Intel are cutting supplies of 9900k :rolleyes:
no because there is no supply to cut
Posted on Reply
#77
GreiverBlade
i like the path it's taking, my upgrade path... definitely a Ryzen and a Vega 64 for next step ...

Intel, Nvidia, don't mind me ... continue like that you are motivating me.... :laugh:
Posted on Reply
#78
HisDivineOrder
I'm sure AMD is happy to take advantage of Intel's obvious missteps. If only they were also in a position to take advantage of nVidia's...
Posted on Reply
#79
GreiverBlade
HisDivineOrderI'm sure AMD is happy to take advantage of Intel's obvious missteps. If only they were also in a position to take advantage of nVidia's...
well for sure i would take a Vega 64 over a RTX 2070 to replace my 1070 ... given the recent review i saw
Posted on Reply
#81
CrAsHnBuRnXp
TheDeeGeeWhy would you buy an Intel 9 Series anyway?

No Hyperthreading and still a big fat premium price.

I'm personally done with Intel, which i been using since 2008. My Next upgrade will be AMD Zen2.
i9 9900K has hyperthreading
Posted on Reply
#82
R0H1T
Batou1986no because there is no supply to cut
Alright ~ diverting production to the highest margin parts. Does that sound better?
CrAsHnBuRnXpi9 9900K has hyperthreading
The HT premium is well over a hundred bucks.
Posted on Reply
#83
Nordic
the54thvoidLaw of economy, when demand is higher for a product, price rises. You artificially create demand by reducing supply. Its the opposite of volume models of trade, where profit margin per unit is low but sheer number sold is immense.

This, if true, is really quite poor from Intel, in terms of how they are treating the consumer DIY market. But, it'll please the shareholders.

Capitalism at its finest. Starve the populace to increase profit.
To correct you a bit, by reducing supply demand remains the same but quantity demanded decreases. I drew you a basic supply and demand graph.

S stands for supply. D stands for demand. Q for quantity. P for price.


Intel has decreased supply as represented with the S line moving left and becoming S2. Quantity demanded has decreased from Q1 to Q2. Price has increased from P1 to P2.

But you are correct that this is the opposite of profit by volume strategy.
Posted on Reply
#84
R0H1T
Except product life cycles aren't linear, neither is demand ~


The demand is at its highest in the first half or third of its time in the market, then as word of mouth spreads the demand grows (or declines in case of bad products) especially after the initial launch.
Posted on Reply
#85
ensabrenoir
....i'm at a loss with intel lately.....there's usually an angle or a method to their madness but as of late it reeks of self sabotage. What the end game here....
Posted on Reply
#86
Assimilator
With all this said, I'm going to retract my claim that Intel's supply constraints for retail are an opportunity for AMD. As has already been shown, retail is the channel that Intel can most afford to concede ground to AMD, simply because it's the least important channel monetarily. If Inte's able to keep up its supply of server CPUs - and Cascade Lake AP or whatever the bloody hell it's called is upcoming shortly - then AMD won't have a chance to break into the extremely lucrative server market and secure contracts there. Which means AMD will be stuck hoping for big wins in the retail space, which will help, but won't entrench its chips in the same way.

There are very bright spots for AMD in the server market - Naples is good, Rome is looking even better, and the announcement of a 10,000-CPU supercomputer built on Rome is a massive win - but it's still too early to say if they're going to be able to gain enough market share there to make them a viable contender in the long term.
I NoThat's BS, AMD handed the datacenters over to intel for FREE during the lifespan of the Bulldozer arch, not to mention the mobile business, the only reason why intel has their hands on those segments is AMD's blunder. The bribe accusation was settled and AMD got a bucket of money, that was back with Athlon 64. Intel played dirty indeed but the failure was AMD's afterwards.
100% correct. Intel maybe be stupid and greedy, but they aren't stupid and greedy enough to try the same thing that got them burned so badly back in the P4/Athlon64 days.
Posted on Reply
#87
R0H1T
AssimilatorWith all this said, I'm going to retract my claim that Intel's supply constraints for retail are an opportunity for AMD. As has already been shown, retail is the channel that Intel can most afford to concede ground to AMD, simply because it's the least important channel monetarily. If Inte's able to keep up its supply of server CPUs - and Cascade Lake AP or whatever the bloody hell it's called is upcoming shortly - then AMD won't have a chance to break into the extremely lucrative server market and secure contracts there. Which means AMD will be stuck hoping for big wins in the retail space, which will help, but won't entrench its chips in the same way.

There are very bright spots for AMD in the server market - Naples is good, Rome is looking even better, and the announcement of a 10,000-CPU supercomputer built on Rome is a massive win - but it's still too early to say if they're going to be able to gain enough market share there to make them a viable contender in the long term.



100% correct. Intel maybe be stupid and greedy, but they aren't stupid and greedy enough to try the same thing that got them burned so badly back in the P4/Athlon64 days.
Say what? They got away scot-free, AMD settled with them out of court for a quick buck sometime around the 2008 global meltdown. Intel didn't admit guilt, also they've not paid a dime to the EU till date :rolleyes:

www.nytimes.com/2017/09/06/business/intel-eu-antitrust-fine.html

In terms of bottom of the barrel corporations, in the tech sector, I'll put Intel right in the top 10. Elsewhere they got a slap on the wrist at best, considering the lost sales (for AMD) Intel not only made bank but also made sure that AMD could never get traction with other enterprises.
Posted on Reply
#88
$ReaPeR$
how much are those managers are getting paid again?! :D
Posted on Reply
#89
I No
R0H1TSay what? They got away scot-free, AMD settled with them out of court for a quick buck sometime around the 2008 global meltdown. Intel didn't admit guilt, also they've not paid a dime to the EU till date :rolleyes:

www.nytimes.com/2017/09/06/business/intel-eu-antitrust-fine.html

In terms of bottom of the barrel corporations, in the tech sector, I'll put Intel right in the top 10. Elsewhere they got a slap on the wrist at best, considering the lost sales (for AMD) Intel not only made bank but also made sure that AMD could never get traction with other enterprises.
Usually, and i use the term loosely, an out of court settlement requires both parts to agree on a sum of moneyz/products/services etc. Once that settlement is reached the accusing part drops the charges, it's beyond me why the officials or other government entities do not pursue these things further but that's another story. Fact is no lawsuit, no penalty, no charges = not guilty. If AMD settled out of court they did it either if it was a quick cash-grab on their part, or the out of court settlement had more on the table than just the money (usually these things don't go public beyond the final sum, that is if they go public). And no, no company would pay a fine without a court order, the EU can ask 100 bil, if the court didn't order the entity to pay said amount the entity does not have to pay, an investigation does not mean that the party involved is guilty, that's the point of a lawsuit isn't it? Furthermore, it's right in the article, the EU can levy fines and demand change of business practices without a court order, which is a bit sketchy. Also this fine was imposed by the EU 9 years ago and it's the result of the out of court settlement between AMD and Intel, the EU just moves a bit slower...
fortune.com/2017/09/06/intel-eu-antitrust-fine-cjeu/
Posted on Reply
#90
R0H1T
I NoUsually, and i use the term loosely, an out of court settlement requires both parts to agree on a sum of moneyz/products/services etc. Once that settlement is reached the accusing part drops the charges, it's beyond me why the officials or other government entities do not pursue these things further but that's another story. Fact is no lawsuit, no penalty, no charges = not guilty. If AMD settled out of court they did it either if it was a quick cash-grab on their part, or the out of court settlement had more on the table than just the money (usually these things don't go public beyond the final sum, that is if they go public). And no, no company would pay a fine without a court order, the EU can ask 100 bil, if the court didn't order the entity to pay said amount the entity does not have to pay, an investigation does not mean that the party involved is guilty, that's the point of a lawsuit isn't it? Furthermore, it's right in the article, the EU can levy fines and demand change of business practices without a court order, which is a bit sketchy. Also this fine was imposed by the EU 9 years ago and it's the result of the out of court settlement between AMD and Intel, the EU just moves a bit slower...
fortune.com/2017/09/06/intel-eu-antitrust-fine-cjeu/
They did it because of the price they paid for the ATI purchase, if the case would've dragged on their increasing debt & decreasing sales would've been a major problem. I also mentioned the 2008 meltdown specifically because it's probably the catalyst that forced them to settle. A long & protracted battle would've been worse for Intel, much worse.

Nope EU launched a probe independently & the EU fines had nothing to do with the AMD settlement in the US. In fact pretty much everywhere around the world Intel got fined. The fact that Intel haven't paid a dime to the EU says everything there needs to be said about them.

en.wikipedia.org/wiki/Advanced_Micro_Devices,_Inc._v._Intel_Corp.

The US DoJ & federal courts have much more power to punish corporations for abusing monopoly or cheating customers, as compared to the EU or any other major industrial nation, perhaps with the exception of China which is down to the power wielded by the CCP.
Posted on Reply
#91
I No
R0H1TThey did it because of the price they paid for the ATI purchase, if the case would've dragged on their increasing debt & decreasing sales would've been a major problem. I also mentioned the 2008 meltdown specifically because it's probably the catalyst that forced them to settle. A long & protracted battle would've been worse for Intel, much worse.

Nope EU launched a probe independently & the EU fines had nothing to do with the AMD settlement in the US. In fact pretty much everywhere around the world Intel got fined. The fact that Intel haven;t paid a dime to the EU says everything there needs to be said about them.

en.wikipedia.org/wiki/Advanced_Micro_Devices,_Inc._v._Intel_Corp.
We're talking about $1.3 billion fine not a parking ticket. Again, if the court orders them to pay they will, if not why should they? That's why there's a case. Aaaand no, AMD finished paying off ATI some time last year, the money that Intel gave them was peanuts compared to what AMD payed for ATI (well maybe not peanuts but still AMD paid through their asses for ATI). Pumping in $5.4 billion into ATI without a plan is something that even AMD in it's worst day wouldn't do, or at least I hope they didn't, but AMD's management back then wasn't the sharpest tool in the shed. But I digress, no company would pay a fine especially a hefty one without a court order, nor should they without one.
www.engadget.com/2006/07/24/amd-buying-ati-for-5-4-billion/?guccounter=1
Posted on Reply
#92
R0H1T
I NoWe're talking about $1.3 billion fine not a parking ticket. Again, if the court orders them to pay they will, if not why should they? That's why there's a case. Aaaand no, AMD finished paying off ATI some time last year, the money that Intel gave them was peanuts compared to what AMD payed for ATI (well maybe not peanuts but still AMD paid through their asses for ATI). Pumping in $5.4 billion into ATI without a plan is something that even AMD in it's worst day wouldn't do, or at least I hope they didn't, but AMD's management back then wasn't the sharpest tool in the shed. But I digress, no company would pay a fine especially a hefty one without a court order, nor should they without one.
www.engadget.com/2006/07/24/amd-buying-ati-for-5-4-billion/?guccounter=1
It's like you're trying to rewrite history, are you? From your own link ~
The Court of Justice of the European Union (CJEU), the EU’s top court, on Wednesday set aside the 2014 ruling of the General Court, which upheld the 2009 fine, on the basis that the General Court had made a legal error. (Somewhat confusingly, the General Court is a lower court within the CJEU—it was the upper court within that institution that made Wednesday’s ruling.)

This does not mean Intel is off the hook—rather, it means the General Court needs to examine Intel’s legal arguments more closely than it did before, potentially giving Intel a chance to have the fine annulled or reduced.
fortune.com/2017/09/06/intel-eu-antitrust-fine-cjeu/
The ruling seals Intel’s most expensive defeat yet in a series of antitrust investigations against it in the US, Europe, Japan and South Korea. The fine–the biggest ever handed down for market abuse by the EU–dwarfs the $25 million penalty that Intel got from South Korea. The US Fair Trade Commission, which had sued Intel in 2009, had settled its case with the company without any fine at all. It did, however, force Intel to agree to major changes in its sales practices.
fortune.com/2014/06/12/eus-top-court-confirms-1-4-billion-fine-for-intel/

What this means is that Intel basically got off a technicality & no firm would settle out of court, paying $1.25 billion, if they weren't guilty!
Posted on Reply
#93
I No
R0H1TIt's like you're trying to rewrite history, are you? From your own link ~ fortune.com/2017/09/06/intel-eu-antitrust-fine-cjeu/
fortune.com/2014/06/12/eus-top-court-confirms-1-4-billion-fine-for-intel/

What this means is that Intel basically got off a technicality & no firm would settle out of court, paying $1.25 billion, if they weren't guilty!
No dude, lol, so
fortune.com/2014/06/12/eus-top-court-confirms-1-4-billion-fine-for-intel/ - 2014 when the EU fined Intel $1.something billion
fortune.com/2017/09/06/intel-eu-antitrust-fine-cjeu/ - 2017 Intel's appeal so to say

I'm not saying that they're not dirty, because they are, but sadly until a final and irrevocable decision is given they are not to pay a dime.
Posted on Reply
#94
R0H1T
I NoNo dude, lol, so
fortune.com/2014/06/12/eus-top-court-confirms-1-4-billion-fine-for-intel/ - 2014 when the EU fined Intel $1.something billion
fortune.com/2017/09/06/intel-eu-antitrust-fine-cjeu/ - 2017 Intel's appeal so to say

I'm not saying that they're not dirty, because they are, but sadly until a final and irrevocable decision is given they are not to pay a dime.
Sure no disputing that, I'm just saying Intel is/was guilty as charged. In fact if it weren't for the AMD settlement they'd potentially have faced more fines in the US. AMD for their part paid the price for acquiring ATI, their revenues dipped & profits tanked following the acquisition in 2007, 2008 & 2009 with a minor relief from that settlement money ~ www.annualreports.co.uk/HostedData/AnnualReportArchive/a/NYSE_AMD_2009.pdf

Posted on Reply
#95
$ReaPeR$
cost versus benefit. how many billions did intel make by erasing amd from the oem market for a decade? i would bet my @ss that is ALOT more than 1.5 bil. so.. :)
Posted on Reply
#96
I No
$ReaPeR$cost versus benefit. how many billions did intel make by erasing amd from the oem market for a decade? i would bet my @ss that is ALOT more than 1.5 bil. so.. :)
If Intel was responsible for AMD's rock-bottom, then AMD managed to find rock-bottom's basement after that: Bulldozer, Opterons based on the Bulldozer arch, the sudden pull out of the laptop segment, paying ATI off, spinning off GloFlo and that extremely "lucrative" contract they were bind to with them, the appalling PR machine. Sorry but Intel added to the list not generate it.
Posted on Reply
#97
$ReaPeR$
I NoIf Intel was responsible for AMD's rock-bottom, then AMD managed to find rock-bottom's basement after that: Bulldozer, Opterons based on the Bulldozer arch, the sudden pull out of the laptop segment, paying ATI off, spinning off GloFlo and that extremely "lucrative" contract they were bind to with them, the appalling PR machine. Sorry but Intel added to the list not generate it.
can you quote where i say that intel is solely responsible for pushing amd from the server market? im not a genious but im also not simple minded enough to believe that the downfall of amd was only intels fault. the 2 crucial factors as mentioned in previous comments was the byout of ati AND intels shenanigans, plus the shitty amd management decisions. my point on cost vs benefit still stands. intel is hardly the only company that does that though, sadly all of them have that culture.
Posted on Reply
#98
TheLostSwede
News Editor
Here's an interesting little tidbit to add an answer as to why Intel is having supply problems. I's not a foundry issue, it's a packaging issue.
Intel is currently transitioning it's chip packaging factories from China to Vietnam and this is apparently a huge task that has turned out to be more complex than they initially expected. They seemingly closed down a little bit too soon in China and this is why we're now seeing a lack of CPUs.
Posted on Reply
#99
Assimilator
TheLostSwedeHere's an interesting little tidbit to add an answer as to why Intel is having supply problems. I's not a foundry issue, it's a packaging issue.
Intel is currently transitioning it's chip packaging factories from China to Vietnam and this is apparently a huge task that has turned out to be more complex than they initially expected. They seemingly closed down a little bit too soon in China and this is why we're now seeing a lack of CPUs.
Ah, those tariffs bringing jobs back to America again, I see!
Posted on Reply
#100
rtwjunkie
PC Gaming Enthusiast
AssimilatorAh, those tariffs bringing jobs back to America again, I see!
That’s not the purpose of tarrifs at any time in history. It’s about forcing equal trade access.
Posted on Reply
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