“The number of transistors on a microprocessor chip doubles every two years and the cost is halved” – this was the observation of Gordon E. Moore, a trend that can’t be imagined in any other industry. With this observation, Moore started Intel, a company that goes on as the absolute and unchallenged leader of the microprocessor industry. Intel, at most times, faced some competition from the minor rivals and which fuelled the innovation and growth in the industry. But with the dawn of the 21st century, the rivals slowly could not keep up and the company became the sole monarch, controlling 96% of the total microprocessor market. This brought a decade of stagnation in improvement and innovation. Intel became sloppy to the point that it lost the entire smartphone industry to ARM (Advanced RISC Machine). The PC and server market was still a safe part for Intel and is what kept the company going. The aforementioned markets affect the world in ways unimaginable, as they control more than 70 billion US dollars and have an impact on all fields from security, medicine to food and education. Any improvement in this technology changes the lives at a very big level and its stagnation similarly has a major impact.
The scenario changed all of a sudden with the introduction of Zen architecture based Ryzen and EPYC chips by AMD. AMD or Advanced Micro Devices was an old rival of Intel. Zen was the technology that they had been working on for the last twenty years. The processors were phenomenal with more power, more cores, more power efficiency and a lower price compared to Intel. Intel was blindsided and not ready for such an impact, it responded by releasing its own Kaby Lake and Coffee Lake series. All of a sudden, the microprocessor market was on fire and this time around Intel could not be the clear winner. AMD gained market share and revenue jumped, but this was not the end. In Computex 2019, AMD announced Zen 2 architecture and a 7nm GPU. The market again was on fire and the major brands all released their motherboards that support the CPU, thus showing an industry-wide adaptation.
In CES 2019, AMD announced its third generation of Ryzen CPU, a 7nm based processor. The 12 core, 24 thread processor by AMD was at half the cost of Intel’s similar processor thus bringing the luxury of a high-end processor to the average consumer. At the same time, Intel was still trying to get its 10nm chip production factory working, trying to produce an inferior quality product compared to its rival. This was another one of Intel’s mistakes that helped AMD rise higher with a 7% increase in stock prices. These continuous mistakes on Intel’s side coupled with a shortage of supply encouraged the consumers to switch, giving AMD a 5% rise in market share in both PC and Notebooks with AMD now expected to grow to 30% to 50% market share by 2020. But these predictions might not come true as Intel too is gearing to make a comeback. Its 10nm plant is almost ready and it might be in talks with major manufacturers for sale of its 10nm and 12nm low-end CPU. A fierce competition often drives a range of new innovation and forces the competitors to their feats. This CPU war can be rather beneficial to the ordinary consumer and perhaps can make up for years of stagnation.
Intel is not the only company that AMD is competing with head to head, AMD has also started the GPU war with Nvidia Corporation. The introduction of Zen architecture to the GPU has changed the conditions of Nvidia’s monopoly. AMD now plans to launch its new series of Navi GPU based on 7nm technology, which will make it far more power efficient compared to its current version and better at computing power too. But the story of Nvidia is different from Intel. It has not made any mistakes yet and has had its own timeline of development and research, making it a much harder competitor to face. AMD can only rely on the hopes that its own processor and GPU will make a better couple.
One of the major markets that Intel dominates and AMD wants to gain control of is the server market. AMD had released EPYC and Threadripper series to gain a footing in the market and the strategy has indeed paid some rewards. But the slowdown of demand in the cloud market has made AMD expand into other sectors like aerospace, automobiles and telecom. The enterprise sector makes up a large part of consistent demand and holding a stage position in this sector can provide a stable footing in the whole market.
These recent changes have all been in favour of AMD and a big reason is the hatching of Zen architecture egg that it had been warming up for years. But at the same time, it should not be forgotten that AMD has shown prospects of rising up the ladder but Intel and Nvidia still own the ladder and they have been countering the company well too. AMD has a long way to go before it can really become a rival or a potential threat. The company itself is also very well aware of this fact and its recent licensing of the Radeon technology to Samsung for its chip shows just how eager it is to expand into the mobile market. This constant struggle of the company can probably propel it to greater heights.
Constant competition between the giants brings better and more affordable devices to the common consumer. The competition does always have a winner and then with a sole winner, another cycle of innovation stagnation appears.
It is reasonable to hope that AMD fights at its best and Intel and Nvidia hold their grounds.
Or perhaps the appearance of another dark horse like Qualcomm could make the competition even more interesting.