Did Intel Just Mislead Chip Investors?

Intel (NASDAQ: INTC  ) made quite the splash earlier this week when it announced 7-watt Ivy Bridge processors for laptops and tablets. Considering how the previous generation consumed 17 watts, this was received as quite an accomplishment in terms of energy efficiency. Sadly, it turns out that marketing hype takes most of the credit for this work.

Invent a new metric
When the numbers didn't give Intel its desired outcome, the company decided to invent a new metric, "Scenario Design Point," to measure power consumption. Traditionally, chips are compared against one another by what's known as thermal design power, or TDP. It measures the amount of cooling power required to dissipate heat created by the processor. Simply put, machines are built with a specific amount of cooling power to ensure a chip will not overheat. The amount of cooling power is directly related to a chip's TDP output.

Scenario design point, on the other hand, measures how the chip performs under "average" conditions. Out the box, these 7-watt rated SDP chips are actually rated at 13 watts under TDP terms, unless the manufacturer decides to permanently downgrade it to 7 watts. This would be appropriate for a tablet form factor where heat dissipation isn't a strong suit. Naturally, this power savings comes at the expense of raw processing power. At 7 watts, a 1.5 gigahertz chip will run at 800 megahertz by default, but still has the capacity to throttle higher when loads dictate and temperatures remain low.

Just being honest
Intel claims it's just being honest with its partners, giving them the flexibility to use the chips for different purposes. From a business standpoint, it allows OEMs to leverage a better economy of scale by being able to buy one chip that has many different uses over a longer period. From a manufacturing standpoint, it's more efficient for Intel to fabricate one chip. But as an investor, I'm a bit disappointed. I, too, was under the belief that these chips were significantly better than the previous generation. Previous 17-watt Ivy Bridge processors were already capable of being throttled down to 13 watts TDP -- exactly where this generation begins. In the end, The argument that Ultrabook OEMs would have to refresh their inventories because the generational energy improvement was so significant is no longer compelling.

When it comes to dominating markets, it doesn't get much better than Intel's position in the PC microprocessor arena. However, that market is maturing, and Intel finds itself in a precarious situation longer term if it doesn't find new avenues for growth. In this premium research report on Intel, our analyst runs through all of the key topics investors should understand about the chip giant. Better yet, you'll continue to receive updates for an entire year. Click here now to learn more.


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  • Report this Comment On January 12, 2013, at 12:20 PM, stretcho44 wrote:

    "Traditionally, chips are compared against one another by what's known as thermal design power, or TDP. It measures the amount of cooling power required to dissipate heat created by the processor. Simply put, machines are built with a specific amount of cooling power to ensure a chip will not overheat. The amount of cooling power is directly related to a chip's TDP output."

    Traditionally, chips ARE compared against one another with TDP or some other common metric. They still can be compared by TDP if that is what you need for your system design. The problem with your logic is that it only seems to apply to Intel.

    What is the TDP of any Qualcomm Snapdragon chip?

    What is the TDP of any Nvidia Tegra chip?

    How long did it take you to find the TDP for those chips? Be honest. I COULD NOT FIND THEM.

    This article and a whole series of other FOOLISH Intel bashing articles seem only designed to pump up interest in your PREMIUM RESEARCH REPORT.

    Before you start your hopping up and down, you probably should do a little reading on SDP and understand how it is used and what benefit the designer can reap. A designer can use the guaranteed SDP to design a system with a power max guaranteed to be below TDP.

    Try to find a Qualcomm data sheet.

  • Report this Comment On January 12, 2013, at 1:44 PM, TMFVelvetHammer wrote:

    stretcho44,

    I agree with a lot of what you are saying, however, being that the writer owns shares of Intel, he's probably being mostly genuine in his personal opinion of the information about the power consumption measures, no matter how off-base (I think just a little, but not a lot) his opinion may be.

    The bottom line is that many Intel investors want to see a big splash in mobile computing with a revolutionary microprocessor design, and the author clearly thought that the 7 watt deal was just that, and now feels a bit misled.

    I think it's a good article, especially for those of us that don't now about the specifics that he discussed. And now we do!

  • Report this Comment On January 12, 2013, at 2:16 PM, techy46 wrote:

    Ok the Ivy Bridge (IB) was originally at 17 and could be throttled down to 13 but now it's 13 and can be throttled doen to 7. I still see a 20-50% decrease in TDP and it has more processing power then Tegra or Snadragon. Aren't you really upset because Intel's tick tocking it's way past Nvidia and Qualcomm? I mean what do you really think the Atom 3D 22nm numbers will be? It seems to me that Intel's got AMD, Apple, Nvidia and Samsung in their sights between 22 and 14nm no matter what metric you cherry pick.

  • Report this Comment On January 12, 2013, at 6:15 PM, stretcho44 wrote:

    elihpaudio,

    I hear what you are saying. I am not sure how Intel could have disclosed this information without people complaining about "some Intel scam". The Intel OEM's are now able to build systems where the CPU consumes less than 7 Watts.

    Before that Intel announcement, anyone designing a system would have to design for the max TDP. They had no other number for reference.

    My shock is that it took Intel over a year to provide this SDP number for Ivy Bridge to help build long battery life devices. Intel should have made it available at Ivy Bridge 22nm introduction.

    The press release defined the low power CPU announcement by Intel. It was also used for the announcement speaker notes.

    "Skaugen announced today that the company is bringing the low-power line of processors into its existing 3rd generation Intel Core processor family. Available now, these chips will operate as low as 7 watts, allowing manufacturers greater flexibility in thinner, lighter convertible designs. Currently there are more than a dozen designs in development based on this new low-power offering and they are expected to enable a full PC experience in innovative mobile form factors including tablets and Ultrabook convertibles. The Lenovo IdeaPad Yoga* 11S Ultrabook and a future Ultrabook detachable from Acer will be among the first to market this spring based on the new Intel processors and were demonstrated by Skaugen on stage."

    http://newsroom.intel.com/community/intel_newsroom/blog/2013...

  • Report this Comment On January 12, 2013, at 8:11 PM, TMFVelvetHammer wrote:

    stretcho44, thanks for the link.

  • Report this Comment On January 13, 2013, at 12:22 AM, Kafue wrote:

    "However, that market is maturing, and Intel finds itself in a precarious situation longer term if it doesn't find new avenues for growth."

    Given the desperate flood of MF articles on Yahoo, the same could be said of Motley Fool and its supermarket tabloid headlines. I suppose it won't be long before MF publishes pieces about the Intel connection to Roswell and a potential buy-out by Martians.

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