x86 CPUs: Why Intel and AMD have no competition
In the tech world we have a bit of a problem, as Linus illustrated in his “Intel innovation video”, after around 2013, now 4 years ago, Intel’s CPUs stagnated in real world, and often synthetic, performance. We’ve just seen this once again with their Kaby Lake CPUs, which besides a slight improvement for video playback, they are no better than the now ‘last generation’ Skylake CPUs and can even be more power hungry at the same clock speed.
The solution to this many would argue is AMD – Intel’s main competition in the x86 CPU market. Thanks to a licensing deal I’ll talk more about later, AMD and Intel have agreed to let each other use their proprietary technologies freely. Unfortunately, until AMD’s Ryzen CPUs are available (in the coming months!), AMD hasn’t been much of a competitor to Intel over the last 5-10 years. To a point, it isn’t entirely their fault as was shown pretty clearly in AdoredTV’s video on why the GPU war is over, since consumers aren’t always making the best buying choices and often buy based on brand loyalty versus actual performance/price/heat/features etc.
So, you might have wondered, why isn’t there another company making high end, gaming ready, CPUs? Well, it’s a bit complicated and in this video I’m hopefully going to make it a bit more clear for you. If you want to know more about the cost of making a CPU, beyond what I’ll talk about in this video, take a look at the video I did last week on the cost, and steps, to making a competitive x86 CPU.
Beyond the $1-3 (or more) billion price tag, there are actually a few specific challenges that stand in the way of having a worthy competitor to Intel and AMD. The first of which is licensing. As I mentioned earlier, Intel and AMD have an agreement to not sue each other for using each others’ technologies. The story surrounding this is fascinating, so I’ll leave a link to a brilliant article in the description below along with all my other sources. To summarise, in 1978, Intel designed and created the 16 bit x86 instruction set to go along with their 8086 CPU, with the instruction set known as i386. They further expanded on this to 32bit with the 80386 processor in 1986, although in 2003 AMD beat them to 64 bit with their K8 Opteron processors which were the first to use the now standard x86-64 instruction set (also known as AMD64). Intel has a patent on this microcode design known as the ‘338 patent, and boy have they been sued a lot over it. AMD sued them in 1987, to which Intel counter sued in the 1990’s, ending in a settlement of AMD gaining their cross licensing agreement they use to this date.
The reason this is so important, is that other companies including Cryix, a now bought out/defunk company, sued Intel over the patent too. They were what AMD now are, which is ‘fabless’ – basically they didn’t make their own CPUs, they paid Texas Instruments, SGS Thomspon and IBM to manufacture them. Since all of those companies held existing licenses, the court decided there was no issue with using Intel’s IP as long as Cryix got the chips manufactured by someone with a license. Intel and Cryix settled out of court with a wide cross license.
This is brilliant news for a newcomer to the market, since you are potentially now able to dodge what is a very big issue by getting someone with an x86 licensing agreement to make your chips for you. The problem you might face with this however, and one a now bought out company called Transmeta found out too, is that the companies you’d partner with generally want a profit split, along with up-front cash to do that sort of thing.
Transmeta was a company pretty secretly founded in 1995, with around $288million in capital. In 2000 they showcased their ‘Crusoe’ CPUs, which were x86 compatible, manufactured primarily through IBM (who they had a profit share with), and while the chip didn’t live up to the hype and therefore was somewhat cornered into what was at the time a very nieché market at the time of the small form factor, low power segment, it was impressive nonetheless. In 2003 they produced the Efficeon lineup which had double the performance at the same clock speed, but still wasn’t all that competitive with Intel or AMD at the time.
That, in a nutshell is the next big problem you’ll face – performance. VIA, a Taiwanese company who make SFF low power x86 CPUs and systems are a great example of this. They make decent CPUs, but they aren’t fast, they aren’t powerful and they aren’t useful for high end workloads. This far along in the development cycle of silicon based CPUs, the technologies are so advanced you would need to basically copy Intel or AMD at this point to get anywhere near to their performance. Investment would need to be in the hundreds of millions, if not billions alone to make a CPU as powerful as Intel’s current generation chips. Compare that to say building a new space shuttle and take a guess which one is cheaper? The freaking space shuttle!
Cost of manufacture isn’t too much of an issue, it’s reported that Intel’s CPUs – at least in the pentium 4 days – cost about $40 a piece to manufacture (yet sold for $600+), but of course that doesn’t take into account design, wages, research and of course the price will have gone up over the years as the process node shrinks – although I wouldn’t expect it to me more than $50 or so per chip.
So to round up, the reasons Intel and AMD don’t have a competitor are, Licensing, cost and sheer complexity. I hope I could help you learn something new, if I did please consider subscribing and sharing the video on tech forums, reddit, or just with a friend you know who might like it – it all helps. If you wanted to help out more, when buying from Overclockers UK or Amazon, you can use the links in the description to support me and the channel, and help me make more of these videos – I love making them and learning loads of new stuff, and it’s great to be able to share it all with you! Don’t forget to watch the video from last week on the cost and steps, and otherwise thank you for watching and see you on friday for a new video as always!
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Sources:
https://en.wikipedia.org/wiki/X86
[Discussion] What is an "x86 license" and why do people mention it? from hardware
https://en.wikipedia.org/wiki/List_of_x86_manufacturers
https://en.wikipedia.org/wiki/Cyrix
https://en.wikipedia.org/wiki/VIA_Technologies
http://www.viatech.com/en/
https://s3-us-west-2.amazonaws.com/via-corporate/via-financials/annual/annual_2014.pdf
http://www.xe.com/currencyconverter/convert/?Amount=1563597000&From=TWD&To=USD
https://en.wikipedia.org/wiki/Transmeta
https://web.archive.org/web/20010602205826/http://www.transmeta.com/crusoe/download/pdf/crusoetechwp.pdf
http://stackoverflow.com/questions/5806589/why-does-intel-hide-internal-risc-core-in-their-processors
http://www.fool.com/investing/general/2015/12/02/how-much-does-the-apple-a9x-cost-to-make.aspx
http://semiengineering.com/how-much-will-that-chip-cost/
https://www.cnet.com/news/intels-manufacturing-cost-40-per-chip/ //Auto play video ads…
https://en.wikipedia.org/wiki/X86-64
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