Versus Intel, has AMD's day of reckoning arrived?

On several occasions, over the past couple of years, I've heard Intel executives predict that any advantages that AMD has on the desktop would evaporate. Although I can't tell if it's the case here, one explanation Intel offered as part of its prediction was AMD's choice to marry its memory controllers to its processors in the silicon.  It wasn't necessarily a bad design choice.  In fact, from a performance perspective, the choice worked, contributing to the performance advantages that AMD has been enjoying on several fronts against Intel.  Intel could have made that choice too and in fact has with other processors such as the infamous i960 (once used for network co-processing but now found in embedded applications). 

But, as Intel explained it to me, due to certain design, manufacturing, and motherboard constraints, once you integrate the processor with the memory controller, you have stick with a specific engineering design (from a speeds and feeds perspective) for much longer periods of time than you do if you take the modular approach that Intel takes.  The result (again, as it was explained to me) is that Moore's Law begins to outpace the long term design choice and, instead of breaking open the bottleneck in performance like an ntegrated design choice does when it's first introduced, it starts to become the bottleneck. 

The general idea is reflected in this story about AMD's Athlon 64 X2 4800+ published by HardwareZone.com last August:

Since the memory controller is built into the processor, the major drawback for AMD's Athlon 64 X2 right now is its support for current memory standards. As we all know it, prices of DDR2 memory modules have reached a very comfortable level today and we have arrived at an inflection point where prices of DDR2 memory are beginning to cost less than DDR1. If this carries on, it will soon be too costly to build AMD-based systems since they only support the older DDR standard. Think of it this way, is it worth to invest in an old memory technology? We can already hear skeptics chanting away that DDR2 operates at much higher latencies, but that's not quite true any longer. Lower latency DDR2 memory is fast replacing the initial high latency ones and as mentioned, the prices are coming down. Although AMD has plans to roll out new processors supporting DDR2, it is not without a price. Firstly, current motherboard manufacturers have to redesign their boards for DDR2 memory, including introducing a new socket (dubbed M2) to support these new DDR2 processors. Secondly, AMD actually planned to introduce these new processors only in the second half of 2006 - which, in our opinion, is way too late. If you purchase an Athlon 64 X2 today, a year later, your memory modules, processor and motherboard will go obsolete once the new Socket M2 hits the market.

Intel has told me that the net result is a game of leapfrog where the earlier processors in any new generation of integrated designs like AMD's would probably outperform Intel's processors on certain benchmarks but that as time passed and Moore's Law took its toll, that Intel's modular design would allow it to introduce certain improvements more frequently thereby causing Intel to regain the lead, perhaps until AMD launched its next generation of integrated design. Again, I don't know if that's the case here and, while the explanation seemed plausible, Intel may have been blowing smoke at me.  But, what is the case is that Intel's prediction of the results appears to be coming true from a benchmark perspective.  According to George Ou:

So last Friday when I saw the first set of independent benchmark results pitting a mid-end Intel E6600 "Conroe" 2.4 GHz CPU (due next month) against the just released flagship extreme edition AMD FX-62 CPU, I started wondering if AMD worst nightmare was coming true.  Intel's ~$250 E6600 CPU annihilated AMD's ~$1000 Extreme Edition AM2 based FX-62!  This effectively means that AMD's flagship desktop performance CPU will be obsolete by the end of next month when Intel [releases] the CPUs codenamed Conroe. The 2.4 GHz Conroe E6600 CPU is a 65 watt part while Intel's Extreme Edition Conroe CPU will operate at 2.93 GHz and still be 40 watts lower than AMD's FX-62 which runs at 120 watt TPD.  AMD's power advantage over Intel's current Pentium 4 NetBurst architecture just vanished in to thin air with the introduction of Intel's Core 2 architecture next month.

Obviously, there's much more to benchmark performance than just the speed of the path from the processor to the memory controller.  In-Stat's Kevin Krewell explains:

Meanwhile, in Austin, Texas (the Real Home of AMD)...It looks remarkably like AMD was caught flat-footed by the improvements Intel made in the Core microarchitecture. AMD was probably expecting performance parity from Intel’s new microarchitecture, with a slight Intel advantage on (lower) power. But Intel’s Core microarchitecture looks a lot more capable, with a wider-issue core, faster SSE hardware, wider internal buses, more prefetchers, 4MB of L2 cache, and a deeper pipeline. It now looks as if AMD will go from being king of the hill in desktop and volume server processors to being just competitive—at best....AMD will be introducing a new processor socket design to support DDR2 memory, and that should give AMD a few percentage points of improvement in performance, but Intel was showing Conroe systems at IDF with 20% or better performance over AMD’s fastest processor on CPU-challenging computer games. Even with DDR2 memory, AMD will very likely lose its position as top dog in the gaming and enthusiast markets that it enjoys today.

But regardless of what's going on under the hood, it's the results that count.  Regarding those results, AMD has drawn the testbed that yielded those results into question (and in fact cajoled attendees about it during a briefing last week). However, in seeing more than just a frog-leap, Ou thinks it will be Intel that gets the last laugh for now:

The problem here is that this new Intel lead is not the usual leapfrogging where one competitor edges out the other, it's a massive lead across the board!  AMD will be shifting to a 65 nm process by the end of the year and adding 128 bit floating point processors by the middle of next year though it's not certain if they can make a massive performance gain while making a massive reduction in power consumption ..... Intel on the other hand told me that they won't be standing still and they don't ever intend to make the same mistake of allowing the NetBurst architecture to stay around for more than 4 years again.

Not only that, Intel may be looking to end the game of leapfrog by once again (like it did with the hybrid 32/64 architecture) copying AMD's approach.  In what could very likely become a hybrid approach that offers the best of both worlds -- the short-term gains of memory integration and the long-term gains of modularity -- it appears as though Intel will be offering desktop, mobile, and server processors that take the integrated approach by 2009.  According to a piece by the Register that quotes In-Stat and asks Intel to build DRAM units into desktop, mobile CPUs?:

Intel is to follow AMD's lead an integrate memory controllers into its microprocessors, market watcher In-Stat has forecast. By 2009, it reckons, 70 per cent of all x86 processors shipping will have their own memory controller, it said.

Such a move by itself might not be able to neutralize AMD's ability to play leapfrog. After all, going toe-to-toe with AMD by copying what it does assumes that AMD doesn't have more technological innovation up its sleeve and history has proven otherwise.  But, what it may do is refocus the competition between the two companies on a war that Intel has traditionally done well with -- manufacturing and fab capacity.  If for example, Intel can use its manufacturing prowess to somehow yield shorter integrated design cycles than AMD, then AMD's reputation for netting performance breaktrhroughs by way of innovation moves to front and center.  Whereas AMD had to basically go it alone to get this far (from an innovative point of view), the fact that it is very good friends with Sun these days (another company that's doing some very innovative stuff in processor design), should not be lost in any big picture analysis.