Originally Posted by monstercameron
ok, my theory is, for intel to maintain the process lead, it will have to sink tonnes into R&D but the moment they start selling low margin chips in a crowded market [remember this is different than desktop where intel pushes amd around] the wont be making any substantial profit to keep R&D money flowing into their fabs.
also tsmc, for example isn't tied down to first party products only...the best part about being fabless is lowered operating cost and flexibly.
Smaller processes produce more chips per mm^2 (w/ same transistors) = better yields.
Small chips (atom) have very high production #'s per wafer = cheap to produce
Intel can make more chips for cheaper and charge more for them due to being a process or two ahead and having the performance/efficiency from that.
The more of the supply chain you own, the more profit % you make or keep. Its like this in every market.
The separate fabs also need to sink lots of money to try to catch up (in this case) or to get ahead. This R&D $ that all fabs have to spend, gets footed to the independent chip makers wanting chips produced + profit margin. These chip designers are also stuck to whatever process schedule the fab is at, even if its behind. Being at the mercy of another company is not desirable.
Intel having exceptional fabs that are under its control make intel them an extremely powerful competitor.