Advanced Micro Devices: Life beyond Intel

This was in response to the launch of the Pentium 4 2GHz processor of its archrival, Intel Corporation (Intel) based in the same city (Refer Exhibit I for a note on the microprocessor and Exhibit II for a note on Intel). AMD's move did not attract much attention initially as Intel had always beaten it on the market share, brand recall and product superiority fronts for decades (Refer Table I). Over the next few months, news spread across the globe that the Athlon processor was much better than Pentium 4 in terms of performance. Intel had to face customer unrest as the usual marketing hype surrounding the launch of Pentium 4 wore off and Athlon was increasingly being accepted as a technically superior product. Analysts observed that Intel's advertisements had made PC users believe that a higher clock frequency resulted in higher performance - something that was reportedly far from the truth (Refer Exhibit I).

Due to its financial muscle and successful marketing efforts, Intel had always had the lead in this battle for leadership and most of the leading personal computer (PC) original manufacturers used Intel's chips for their PCs. However, things changed with Athlon. AMD sought to break this widely accepted 'Megahertz Myth' which attributed a microprocessor's superiority to its clock speeds. In Athlon, AMD had a product that challenged Intel's chips not on the basis of clock speeds, but on the overall performance of the processor. Commenting on this, Wee Yep Yin, Product Marketing Manager, SEA, AMD Far East, said, "Ultimately, AMD delivers what is most important to business and consumer PC users - superior software performance, higher productivity and platform longevity."