Intel Is Reducing Server Chip Pricing in Attempt To Stem the AMD Tide

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Intel has pivoted on its server strategy in order to fight a supply-constrained AMD, reports DigiTimes. It’s reportedly flooding the market with chips at discount pricing, rather than sticking to MSRP. From a report:

While some reports point toward a relative normalization on AMD’s CPU supply, AMD has two distinct disadvantages when compared to Intel: It has fewer revenue sources than its much bigger CPU rival, and AMD doesn’t own the factories that produce its market-turning Zen chips. Intel, on the other hand, can leverage its vertical integration (meaning that development and manufacturing takes place in an almost entirely Intel-owned and managed supply chain), as well as its massive revenue advantage, to play with final client pricing. In other words, Intel pull a lot more levers to increase demand and (Intel hopes) attract would-be AMD clients back into the Intel fold.

AMD has seemingly been making strides in server market penetration. As seen in renowned system distributor Puget Systems’ statistics, AMD has risen from a 5% share in systems sold since June 2020, up to a dominating 60% as of June 2021. However, unserved demand means that companies looking to invest in their server infrastructure or who aim to deploy AMD chips in any major way sometimes can’t wait for the chips to become available. And Intel is smartly making it more attractive for those companies to go back to the Intel fold, or to skip AMD in the first place.

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