Version: 2008

November 8, 2005 3:14 PM PST

Dell is selling AMD chips. But why?

  • 29 comments
Is longtime Intel-champion Dell testing the waters for home PCs using Advanced Micro Devices processors?

The Round Rock, Texas-based computer maker is offering six Athlon 64 chips on its Web site. The chips are individually packaged for retail sale. Speeds range from 2.0 GHz and 2.8 GHz and prices from $219.27 for the Athlon 3500+ to $1,102.91 for an Athlon 57-FX.

Dell is not selling any of AMD's other chips, such as the Opteron processor for servers or the Turion for laptops.

So why suddenly can you find AMD Athlon processors on the Dell Web site? For the same reason the chips are sold individually in other retail outlets, responds Dell: customer demand.

Still, AMD chips are not yet available inside Dell PCs.

"Dell is constantly evaluating new technologies and at the present time, we don?t have AMD processor-based systems in our portfolio," said Dell spokesman Bruce Anderson.

Dell is the only major North American PC maker to exclusively use Intel processors. Consumer product lines from other companies, including Hewlett-Packard, Gateway, Lenovo and IBM, offer both Intel and AMD chips.

CNET Forum readers spotted the processors for sale last week, although responses were lackluster considering Dell is offering only packaged AMD processors and not installing them in PCs, laptops or servers.

Dell's industry status and historic devotion to Intel would make any potential move to AMD chips a significant shift. In the past, founder Michael Dell has blasted AMD's Athlon processor as an unproven computing platform. And CEO Kevin Rollins has waffled on the "Dell on AMD" issue more than once.

Dell first tested the waters in 2001 through a survey asking customers if they would consider AMD's Athlon and Duron processors, Intel's Celeron, Pentium III and Pentium 4 processors, and also PowerPC processors.

But these are desperate times in the PC business, and Dell could be looking for a way to bring new customers into the fold by offering lower prices. Dell, which said it will report its third-quarter earnings on Thursday, said last week that its revenue will fall well short of expectations due to sluggish U.S. and U.K. consumer sales.

Meanwhile, computers carrying AMD chips are gaining market share in retail outlets. Desktop computers and notebooks with AMD chips accounted for 49.8 percent of PCs sold in domestic stores in October, compared with Intel's 48.5 percent of the market, according to a report published on Tuesday by research firm Current Analysis.

So why is Dell selling only individual AMD chips and not a Dell Dimension with "AMD Inside"? Because, says independent analyst Roger Kay, Dell is still selling to its original demographic: PC gaming enthusiasts.

"Obviously, you can't put one of these processors in an existing Dell machine. AMD and Intel motherboards are not compatible," Kay said. "Dell is selling these to consumers who may have everything that they need at the moment except the processor.

Dell's sale of wrapped AMD chips is also significant because the company does not typically offer individual PC components, such motherboards or fans.

"Is this the first step in bringing in AMD systems to the Dell market?" Kay asked rhetorically. That will depend on how much Dell succumbs to customer pressure, he then speculated.

While AMD provides discounts on bulk purchases, Dell's AMD chip prices are on average about $10 to $80 more expensive than Sunnyvale, Calif.-based AMD lists its chips on its own Web site.

See more CNET content tagged:
AMD, AMD Athlon, Dell, AMD Duron, AMD Opteron

Add a Comment (Log in or register) (29 Comments)
  • prev
  • 1
  • next
Why is this big news?
by nasser0000 November 8, 2005 4:13 PM PST
It's all over the place, but they've been selling AMD CPUs for some time.

http://www.geek.com/news/geeknews/2004Mar/gee20040324024414.htm
Reply to this comment
Correct: Old News
by Dachi November 8, 2005 7:06 PM PST
Zach is exactly right. This this was covered early last year.

Dell replied stating that companies prefer to use a single vendor. Dell began selling stand alone AMD processors so their commercial customers didn't have to go through a seperate vendor to obtain them.

What that means is this:

I need to get out more.
View reply
Because of Dell's refusal to use AMD in their machines.
by zaznet November 9, 2005 1:16 AM PST
Dell is certainly getting some volume discounts from Intel. Intel does not want to lose Dell as a customer, and there are some behind-the-scenes deals being struck there.

Dell offering AMD chips for sale in any manner is a sign that they may be opening up to the idea of AMD inside Dell.
View reply
Funny Coincidence?
by sreynolds_2 November 10, 2005 11:33 AM PST
Yeah, Dell started selling AMD chips just about the time that AMD started throwing lawsuits at Intel for unfair business practices. Interesting timing, don't ya think?
It's about time
by explorer5 November 8, 2005 5:26 PM PST
Dells average PC price compared to HP & Gateway is higher over the past few quarters - i think thats primarily due to using Intel processors instead of AMD which HP & Gateway use on their low-cost PCs. Once Dell starts putting AMD chips in their PCs, i think you'll see a dramatic decrease in Dells average PC prices. AMD is and always was less expensive than Intel. (And in my opinion i feel AMD's chip speeds are slower than the Intel equivelent.)
Reply to this comment
I like...
by System Tyrant November 8, 2005 9:14 PM PST
your thoughts on prices.

Well, AMD's ghz usually runs about a ghz slower than the Intel equivelent. However, AMD best Intel in power consumption, performance, and heat. Although performance is kind of boarderline between the two these days, but AMD usually wins a few more than Intel.

However, I think we will start to see a more apples to apples performance benchmark when Intel finally decides to drop the P4 and go with the P-M.
Took them long enough.
by Roman12 November 8, 2005 5:42 PM PST
Perhaps they got tired of loosing sales to other manufacturers because everybody else offer much lower prices. AMD is already outselling Intel chips, as discussed in another article on the site. Once dell joins, AMD might gain a more solid number one spot soon.
__________________________________
R.K.
http://www.Remove-All-Spyware.com/
Reply to this comment
I would have bought a dell 3 times already
by Ikohs November 8, 2005 9:11 PM PST
I get the system all configured and when I am ready to pull the trigger and purchase I stop. I do not want a hot running and extra expensive Intel in my PC's.

When Dell starts building systems with AMD chips inside I would consider buying a Dell.
Reply to this comment
"consider buying a Dell"
by zaznet November 9, 2005 1:14 AM PST
Sure, consider, but would you click "BUY"? That's what Dell needs to know, that having that AMD option means you WOULD buy a Dell, not that you would just think about it. :)
View all 2 replies
Intel in my PC
by Thunder Johny June 19, 2007 10:13 AM PDT
http://www.analogstereo.com/vacuum/miele_antares_s4_galaxy.htm
I still wouldn't buy a dell
by Bill Dautrive November 8, 2005 9:34 PM PST
It is still a garbage computer maker.

I have a custom built machine with a AMD 2500+, it is clocked at around 1.9ghz. I also have 1GB of corsair XMS ram, geforce 6800 GT, 2 80 GB WD 7200 RPM drives(not in any raid format) with 4 MB cache, IIRC, and an Asus Nforce2 mobo.

Not at all a top of the line system, but running benmarks can equal or beat comparable machines with p4 chips that are 1 ghz faster then mine. That is quite significant. Also, I do not have heat issues. I can play WoW for hours, with every setting cranked up with no video lag or issues and the proc doesn't go over 93 degrees. I can overclock it ~400 mhz higher and still barely gets over 105, and runs flawlessly. All with the stock cooler and 4 fans in the case. I do not overclock it continuously because frankly, my system can run any game I want smoothly without overclocking. Try that with an Intel chip.

Intel offers nothing of value and hasn't for quite some time. Perhaps some day they will take the lead again, but Intel is firmly following AMD, not vice versa, especially in the 64 bit market, which is the future.
Reply to this comment
Customer Demand
by zaznet November 9, 2005 1:13 AM PST
There is a customer demand for AMD processors inside Dell computers. Once they see that demand, they will start selling AMD based systems.

Dell has fallen a bit out of touch with it's customers over the last couple of years. I have hopes that will change. :)
Reply to this comment
Who care about the customer?
by November 11, 2005 9:32 AM PST
Honestly, customer demand only plays with the
serfs. Large companies could care less what
customers want so long as they're willing to pay
for stuff that they're told is sufficient.

Dell's been under pressure for years from
customers to provide AMD CPUs intheir products.
Yet they were also very profitable and grwing
doing what they were doing, so they simply
punted.

You see this alot. Industry has a big chip on
its shoulder and is very antagonistic towards
the customer. The media companies are the most
obvious: the perpetual copyright and
anti-fair-use agenda, threatening to pull CD and
DVD media from distribution, onerous DRM, price
gouging, racketeering, spyware and hacking, etc.

Hell, the seed of Microsoft's stagnation as a
computer company is utter apathy towards the
consumer based on the view "we're Microsoft,
we've got no real competition, you'll use
Windows because your computer will come with it,
and even if you realized there were alternatives
you'd be too lazy to do anything about it,
expecially if everyone else you know is using
it". OpenDocument? sure it would take a week to
code, but screw customer demand -- that
"customer's always right" thing will undermine
our business strategy.

And the companies are right of course. The
majority won't demand quality, fair treatment,
or value. They'll take whatever they're told to.
All a company needs to do, once they get to a
certain size, is sit back and rake in the bucks
and pray people don't wake up.

To be fair, MSFT has been loosing a steady 9% of
their market cap per year for the past 5 years
or so... So, maybe they're starting to feel
pressure to address consumer problem againt.
Would be a good business move
by rdean November 9, 2005 3:00 AM PST
Diversify the product portfolio for those that are either fans of the AMD architecture or don't want to pay the higher cost for Intel.

It'd certainly remove the only obstacle I have for being a Dell customer.
Reply to this comment
Hardly
by adam.skinner November 9, 2005 5:47 AM PST
Gaming enthusiasts (of which I am one) have NEVER been Dell's customers. Dell's customers are businesses and home users who can't build their own machines.

Gaming enthusiasts will build their own machines. Think about it - won't slapping in some extra RAM and a new video card void your Dell warranty anyway?

Anyway, Dell selling AMD processors makes no sense. People don't want AMD processors - they want Dell systems built with AMD processors because that solution is cheaper and performs better than an Intel solution. The bang for the buck is with AMD, and so that's where the smart consumers go.
Reply to this comment
New Hardware does NOT Void Warranty
by Stork1 November 9, 2005 8:47 AM PST
You are free to upgrade your Dell with whatever hardware you can get to work. But Dell will not provide support for this new hardware and you will want to revert to your original configuration before you call them for help, otherwise they will want to blame your 'new' hardware if possible.

But yeah, I can't agree with you more on the other things. If Dell built computers with AMD Processors in them, then THAT would be something worthwhile.

But selling just the processor is rediculous as they charge more than Newegg.com for the processors. (An extra $91 for the FX-57).
bang for the buck
by Thunder Johny June 19, 2007 10:13 AM PDT
http://www.analogstereo.com/mercedes_slk_class_owners_manual.htm
Selling just the chip?
by startiger November 9, 2005 6:10 AM PST
"Dell is selling these to consumers who may have everything that they need at the moment except the processor."

This is their answer to customer demand for AMD based computers? Sell the processor to people who already have everything else?

Question: if they are marketing to the custom builders, why are they only selling the processor? no mobo's?

While I would really like to see Dell broaden their processor line, I don't think this is gonna fly. If you ust so happen to have a AMD style mobo laying around as well as matched RAM chips and everything else and all you need to finish is to get a processor, Dell's website really doesn't come to mind as a place to get your CPU.

If they had mobo's there with it, I could see it maybe going somewhere. But without it, Why don't I see Dell selling too many of these? Unless this is what they want, to prove to themselves that people don't really want AMD's, but I digress.

It seams to me that the majority of people who have enough experance to be able to piece together a computer from bare parts are likely to know enough that they can get it from somewhere else for probably cheaper than Dell would offer it. and someone who has a much more reliable shipping department.

Considering what they charge for their "Dell" printers which are really LexMarks with Dell's sticker in the top, I really can't see them selling too many of these "on the side" AMD chips.
Reply to this comment
Somebody got their data wrong
by WesFlash November 9, 2005 8:53 AM PST
"So why is Dell selling only individual AMD chips and not a Dell Dimension with "AMD Inside"? Because, says independent analyst Roger Kay, Dell is still selling to its original demographic: PC gaming enthusiasts."

I only know of a few really hardcore gamers that use Intel systems. Either I am missing the boat or Dell needs to re-examine the group it calls gamers.

As far as those doing content creation of video, audio, etc., I don't know any of them that use AMD except on the very high end where Opteron processors are used in servers.
Reply to this comment
another angle
by francisramos November 9, 2005 6:35 PM PST
could intel have asked dell to sell amd? isn't there an anti-trust lawsuit against intel that AMD filed? why sell chips without compatible mobos or inside built systems? thats not the way to test the market.
Reply to this comment
Proof in the paycheck
by November 10, 2005 7:17 AM PST
The fact that Dell is selling AMD chips on it's Software and Peripherals site is proof positive that Dell sees more value in itself from a sales channel perspective than as a hardware maker.

The fact that Dell doesn't use AMD is simple economics. Intel gives them TOO much marketing funds (find me a Dell anything without an Intel tattoo on it).

Lagging customer service, rising prices? Whatever happened to the company that said they were "DIRECT"...focused on the customer. I guess they meant focsued only on the customer's wallet.

O brother where art thou? How I miss you as a start up company doing great things....

Get off the "junk" Dell. Kick the habbit. Time to start building good machines again. Use AMD!
Reply to this comment
customer's wallet
by Thunder Johny June 19, 2007 10:13 AM PDT
http://www.analogstereo.com/infiniti_q45_owners_manual.htm
The real truth why dell is selling AMD chips...
by maltenrazer1 November 15, 2005 5:18 AM PST
http://www.channelregister.co.uk/2005/11/09/dell_athlon_amd

read that and all will become clear
Reply to this comment
AMD Chips in Dells
by nathanhuth November 21, 2005 11:13 AM PST
My opinion is that Dell will port the AMD processors into their own PCs in the near future. Remember what the did with the ink cartridges? Dell started putting their own brand ink cartridges in other name brand printers, and then what happened next? Dell branded printers!!!
Reply to this comment
(29 Comments)
  • prev
  • 1
  • next
advertisement

Latest tech news headlines

RSS Feeds

Add headlines from CNET News to your homepage or feedreader.

More feeds available in our RSS feed index.

Markets

Market news, charts, SEC filings, and more

Related quotes

Advanced Micro Devices (0.00%) 0.00 9.83
Dell (0.00%) 0.00 14.60
Hewlett-Packard (0.00%) 0.00 52.76
Intel (0.00%) 0.00 20.30
Dow Jones Industrials (0.00%) 0.00 10,547.08
S&P 500 (0.00%) 0.00 1,127.78
NASDAQ (0.00%) 0.00 2,291.08
CNET TECH (0.00%) 0.00 1,662.16
  Symbol Lookup
advertisement

Inside CNET News

Scroll Left Scroll Right