Welcome to this final installation of American Idol Preview, where we try to predict who the next Idol will be by looking at the businesses the competitors seem to embody. This week, we're checking what's inside Katharine's and Taylor's handy-dandy notebooks.
We'll start with Katharine again. Looking good as usual, she's sporting a Dell
But not unlike our songbird heroine here, the company has seen some hard times lately. Execution doesn't appear as sharp as it once was -- something CEO Paul Otellini recently promised to change. Promising no stone left "unturned or unlooked at," Otellini is reviewing every opportunity to tighten operations across the company.
So who's snapping at Intel's heels to the point where the giant feels the need to restructure its entire business? Why, Taylor's Advanced Micro Devices
The Athlon 64 and Opteron product lines marked the first time somebody other than Intel made significant changes to the venerable x86 design. Expanded from 32- to 64-bit operations, with a memory controller in the chip itself and supported by the incredibly scalable HyperTransport interconnect technology, these chips left Intel's best in their dust for most tasks.
From the latest games conducted via high-traffic Web servers to the render farms at DreamWorks Animation
But Intel is far from ready for the great gig in the sky. Later this year, a new line of chips is expected that looks certain to kick some sand in AMD's face and take its girlfriend home from the beach. Codenamed Conroe, but officially branded Core and Core Duo, this architecture bears little similarity to the Pentium 4 line, instead tracing its bloodlines back through Pentium M and Pentium III processors. Paul Otellini is showing some backbone by supporting a throwback design and basically calling the Pentium 4 NetBurst architecture a long-term failure. The new chips are said to outperform the formerly unbeatable Athlon 64 dual-core processors by about 20% in many common tasks, and AMD has no immediate answer to that kind of disadvantage.
Instead, the focus there is on expanding what AMD still does best. Remember HyperTransport? Thanks to the innovative memory architecture and massive bandwidth between system components the interconnect design provides, and which Intel cannot match even with Conroe/Core, Opterons tend to scale better in multichip designs. Thanks to this advantage, AMD has picked up an estimated 45% U.S. market share in the four-way server market and even added Dell to its client roster for exactly that sort of system.
That's a big deal to AMD, which has been shut out of market leader Dell's plans since the dawn of time. It's almost a bit ironic that the reversal of that stance was greeted by analysts with cries of "too little, too late" -- for Dell! The company has been bleeding high-end server market share to competitors like Hewlett-Packard
Partly because of Dell's refusal to sell AMD-based systems, the chipmaker has gone so far as to accuse Intel of anticompetitive practices and other forms of business gamesmanship, and filed a lawsuit to that effect last June.
It's not my place to say whether the suit made Intel loosen up its practices enough for Dell to take in competing products -- I'm just a talent show host -- but in the end, it may not matter. The Core architecture might well be strong enough to convince Dell and other system builders that "Intel Inside" is back in style across the board. On the other hand, anything less than that would eventually have forced Dell to go with the hot hand anyway, and perhaps that's exactly what happened here.
Sometimes the business world can be as entertaining as our own show, although I'd be shocked to see Taylor suing Katharine for antitrust behavior. We're left with a smooth performer with clearly superior fundamentals, and an upstart with some fresh moves and the occasional power note. It's up to you, America, to decide who will be your next American Idol. Seacrest -- out!
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Intel and Dell are Motley Fool Inside Value selections, while DreamWorks Animation and Disney are Motley Fool Stock Advisor picks. Could your portfolio use some extra CPU time? Whatever your investing style, we have a newsletter service that will help keep you informed and attuned. A 30-day trialis yours for free.
Anders Bylund can do a passable Ryan Seacrest impersonation, but not in public. He owns shares of Disney, but of no other company mentioned today. The Idolspoofing is all in good fun, but Foolishdisclosureis a serious matter.