AMD isn't in a position of strength vs MS. Period. They have compelling products for a console, and experience that doesn't mean their isn't competition for the hundreds of millions of dollars such a contract is worth.
And keeping their best IP for themselves, why? To do what with it? Isn't the idea to make money with it? I'm sure the negotiated deal includes all sorts of competition clauses whereby MS won't be selling GPUs that compete with their products. Not that it will matter when the next box launches because any of the parts you're talking about from AMD will be EOL.
Sorry I never post car comparison but there is clearly an issue about how the price of something is determined.
You have 2 engines manufacturers, one provide the same performances as the other but at 33% less.
Both manufacturers have multiple generation of products but the difference is consistent among those generations.
What you guys are saying is that a company that wants to produce a car and go to the manufacturer whose engine IP provides a 33% reduction in cost production will be offered de facto by the aforementioned engine manufacturers its last IP without any premium or anything because they have no intensive to do so?
I don't believe it works that way, actually I'm pretty sure that no economic model expect things to works that way.
How it's works is that the engine provider is pretty well aware of the other engine provider company port folio of product. They have sales persons for that. In regard to competition offering and their own port folio they will set prices ranges for their existing IP and try to get the most out of it during the negotiation. They are more than aware that they have a competitive advantage over engine company B and they better get the most out of it because either way they are fired.
So how the negotiations turns out, the sales persons leverage their port folio to have you pay more than you want to pay. The car company will also try to get the best deal but they know that they are in the weak position as they want one of their engines.
In concrete term the sale persons will ask quiet a premium on their last gen model. You can pay if you want. Either way if you want a better deal you will end up negotiating a sweeter deal on on of their previous generation engine.
Sales persons don't give a shit if it makes sense to produce an older IP or not.
So I don't see how MS is is position of strength. "Period" is a trolling argument.
"evergreen" "southern island" north island" "GCN" IP have no price by themselves. Negotiation in the context more global of what the market offers (see engine company B) will define a price for the IP the car manufacturer will ultimately choose. AMD has no reason to let go their best IP without a premium.
Sorry again but that's how thing works in the real world.
AMD is not ATI crumbling under debt still they need to get the most out of a licensing and they are leader. What are the to leverage during the negotiation but their IP
s port folio?
That's not saying that GCN can't be chosen. The car company can agree to pay more a bit than they wanted less than what the sales persons were asking and say I can go this far for your last gen engine and sales persons comply with a smiles dreaming of those extra pennies per engines sold and how their bonus will sky rocket. It could be the same at the car company which may have played it well and ultimately give less than they were willing to give.
Still the car company may just pay what they wanted to pay and it's not enough for the last generation engine, because sometime life sucks. The same process applies as above sales persons may do well or the buyer get a sweeter deal but it's not written in advance.
Either way around the sales persons comes with a real good deal based on last gen engine within the budget of what they think their costumer is willing to pay. Then they leverage their last generation and its shiny cylinders to have the costumers to pay more.
etc. etc.
The car company will comes with a list of requirement usually more than exactly the engine they want but they could come with what they think is the best deal. Ultimately they negotiate.
Short story made long a world where a company is not trying to make the most of its last gen IP is not our world.
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And now say AMD are angels doing charity business there is also the option that GCN doesn't offer the most bang per transistor for the intended use of the product but that a completely different issue.
Or the MS or NIntendo are iffy about what was unproved IP at the time of the decision.
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