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AMD: Intel's Conroe power advantage claim based on skewed metric

Capitalizing on the 'emerging purchase criteria'

The coming days, from AMD's perspective, will require a kind of re-educational effort as to what power really means. Just like in a political campaign, when one candidate seizes the advantage on a key issue, the other side tends to devote time to redefining the terminology used to describe that issue.

"We've got a team internally focused on, how do we develop some messaging that can better educate the market... as to what the true power consumption attributes are," AMD's David Schwarzbach told TG Daily. "When we released our energy-efficient line back in May, our press release stated a factoid that, when running in a typical load, our 65 watt TDP processor, end users can expect to see as low as 14 watt power consumption at the platform level." So much of a computer's time is spent in idle mode that any metric that would claim to be more fair, should take idle time into account, AMD believes.

"We're looking for a way to communicate this more effectively to the market," added Schwarzbach. "We're just not satisfied right now that the industry is doing a good job of communicating these attributes, so look for better things to come from us in market education for the second half of the year."

The second half of the year is when AMD plans to unveil the first products in its new "4x4" architecture, which promises two sockets for a pair of dual-core processors. Here is where AMD will have the opportunity to respond with performance figures; but unless AMD has plans to make a U-turn in its design strategy on the order of the U-turn Intel is making - perhaps successfully - then AMD has a fundamental dichotomy to overcome: How can it make its key message of "performance-per-watt" - what, in marketing parlance, is called an emerging purchase criteria - play to an enthusiast market for whom low power, singularly and most uniquely, isn't cool?

"[Performance-per-watt] is an emerging purchase criteria area," said Schwarzbach, "specifically in commercial [markets], more there than elsewhere, [but] less so with the enthusiast space [for whom] the power consumption is of slightly less concern, but still it's got to figure into the overall mix."

Mike Field added, "At the high end, enthusiasts really are looking for the absolute highest performance that they can get, and they are willing to make tradeoffs to get that. One of them, power consumption, is less critical to them. In fact, if you look at the trends, they are willing to go to multiples. If you look at this space, you look at multiple GPUs, they're willing to throw more at [their systems] to get that absolute highest performance."

If the mainstream market cares about power conservation more than the enthusiast market cares about power consumption, then with the mainstream market growing at a faster rate by many analysts' standards, doesn't that mean the two markets will eventually become segmented? In AMD's opinion... yes.

"It all comes down to the specific customer, and what they're looking for," replied Field. "It is a customer-centric innovation message [where] we look at the specific segment of the customers." For example, he said, the 4x4 architecture will address certain "key competencies" associated with AMD. But 4x4's "customer-centric" message will be devoted to what Field describes as deficiencies that the enthusiast market perceives with being able to derive greater performance from their current systems. For them, conservation is less of an issue.

"Based on the customer segmentation, the enthusiasts are going to be the last area of our industry to to really elevate power consumption as their key purchase criteria," admitted Schwarzbach. "[Among] the majority of purchasers... enthusiasts are a small but very influential part... but for the mainstream and value portions of the industry, [power] is an increasing purchase concern for them."

"But in other areas, there is more of a focus on power utilization," Field made certain we understood, "and in those areas, we're focused on being the leader as well."

If AMD continues with its earlier plan to be the performance-per-watt leader, then so long as it continues to address the enthusiast market, doesn't it risk contradicting itself? AMD's perspective, quite literally, is this: As long as the two markets remain separated like split continents, if you will - and perhaps if there's enough concerted effort to keep them separate - and AMD maintains leadership perceptions on both continents, then if it speaks a different message to each one, the plan could still work.

As David Schwarzbach put it, "We feel like we're covering all bases, and because of the differences in the way this market segments itself, we don't think the potential for contradiction is there."

One other "key competency" AMD may choose to focus on for 4x4 is price. Not once, but twice this week, AMD revealed it would be dropping its price of Athlon 64 processors and others in its performance desktop product line, in a move AMD spokesperson Damon Muzny described as an "aggressive" way "to maintain our price/performance leadership." Since that news was very, very fresh, David Schwarzbach was only willing to allude to it during our interview: "Our price/performance position will remain competitive; our traditional value-based pricing remains in-place," he said, quite carefully. "We price to the value we provide, as denoted by the market, and what their purchase criteria are. So we are in full preparation to respond once these products become available."

For years, AMD's marketing claims implied that Intel's perceived position of leadership was merely a trick of perception, and that once the facts were made clear, AMD's performance position would be secured. Now with that position in clear danger, it would appear AMD's plan to maintain the appearance of leadership will require a substantively similar change in the way we view the market. Perhaps we should adopt a new corollary to Moore's Law: Every year, the number of ways customers are asked to perceive their own technology, doubles.