There is more discouraging news out of AMD as another 5% of their workforce, around 10,000 employees, will be let go by the end of 2016. That move will hurt their bottom line before the end of this year, $42 million in severance, benefit payouts and other costs associated with restructuring but should save around $60-70 million in costs by the end of next year. This is on top of the 8% cut to their workforce which occurred earlier this year and shows just how deep AMD needs to cut to stay alive, unfortunately reducing costs is not as effective as raising revenue. Before you laugh, point fingers or otherwise disparage AMD; consider for a moment a world in which Intel has absolutely no competition selling high powered desktop and laptop parts. Do you really think the already slow product refreshes will speed up or prices remain the same?
Consider the case of AT&T, who have claimed numerous times that they provide the best broadband service to their customers that they are capable of and at the lowest price they can sustain. It seems that if you live in a city which has been blessed with Google Fibre somehow AT&T is able to afford to charge $40/month less than in a city which only has the supposed competition of Comcast or Time Warner Cable. Interesting how the presence of Google in a market has an effect that the other two supposed competitors do not.
There is of course another way to deal with the competition and both Amazon and Apple have that one down pat. Apple removed the iFixit app that showed you the insides of your phone and had the temerity to actually show you possible ways to fix hardware issues. Today Amazon have started to kick both Apple TV and Chromecast devices off of their online store. As of today no new items can be added to the virtual inventory and as of the 29th of this month anything not sold will disappear. Apparently not enough people are choosing Amazon's Prime Video streaming and so instead of making the service compatible with Apple or Google's products, Amazon has opted to attempt to prevent, or at least hinder, the sale of those products.
The topics of competition, liquidity and other market forces are far too complex to be dealt with in a short post such as this but it is worth asking yourself; do you as a customer feel like competition is still working in your favour?
"AMD has unveiled a belt-tightening plan that the struggling chipmaker hopes will get its finances back on track to profitability."
Here is some more Tech News from around the web:
- Microsoft brings LinkedIn to Cortana, and Likes and mentions to Outlook @ The Inquirer
- Microsoft previews less buggy OneDrive for Business client @ The Register
- Toshiba CEO: Yeah, we MAY need to chop some heads @ The Register
- UK scientists create quantum cryptology world record with 'unhackable' data @ The Inquirer