Mr. William M. Holt, Executive Vice President, General Manager, Technology and Manufacturing Group presented at the Intel® Investor Meeting 2013. Mr. Holt’s presentation, titled “Advancing Moore’s Law: Benefits Across the Portfolio”, is very much about one of the key deterrents of the negative effects of any of Professor Michael Porter’s “Five Forces” of competition — namely cost of production.
Professor Porter’s theory of how competition between products manifests itself, provides a useful analytical tool for commodity markets. Mr. Holt’s presentation, in 2013, can be taken as clear indication that the world wide market for computer processors and the circuits required to support them is very much a commodity market.
Mr. Holt’s presentation is all about the impact 14 nanometer manufacturing (14nm) technology will have on Intel’s manufacturing costs. Mr. Holt claimed this new manufacturing method — set to debut in the first calendar quarter of 2014 — will substantially lower Intel’s costs of manufacturing popular computer processors. This lower cost of producing computer chips, with comparable processing power to any offered by its competitors, is characterized throughout Mr. Holt’s presentation (in my opinion) as a powerful deterrent to competitors.
Mr. Holt also spent sometime illustrating Intel’s decision to not only implement 14nm manufacturing technology, but, further, to leverage this new platform to support a substantially smaller wafer size for the chips the new system will produce.
He supported his presentation with a couple of slides produced by customers and one of Intel’s strongest competitors — ARM. The references to customer presentations add credibility to Mr. Holts’ claims. The slide excerpted from ARM’s TechCon 2012 illustrates a different manufacturing strategy for chips exploiting 14nm technology. As Mr. Holt explains, ARM presented its 14nm method within the context of a consistent wafer size, without the size reductions Intel plans to implement.
But the ARM TechCon reference dates back to 2012. Anyone following Intel, its manufacturing technology, and the competitive landscape for Intel’s products should research how ARM has addressed the question of whether or not a reduced wafer size will contribute, substantially, to a lower cost of manufacture for its own 14nm products.
© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved