A few years ago Intel was struggling to match the performance offered by AMD's Athlon 64 processors. The on-die memory controller, a fast, but narrow, chipset interconnect and elimination of the FSB was clearly paying dividends for AMD as their processors left no question about who was king in the performance department. Prices reflected this, as for the first time AMD was not the underdog and they were able to sell their top-of-the-line processors at a premium. With the launch of Core processors, based on the Conroe architecture, Intel basically switched places with AMD overnight and AMD has been fighting a losing battle ever since. For AMD this basically meant that over the course of the last two years they have only been able to compete in terms of processor pricing. AMD's processors and chipsets have been priced considerably less than Intel's in an attempt to gain or keep market share.
With the arrival of the Core i7 processors the performance gap has been widened further. Furthermore, architecturally Intel has caught up with AMD by incorporating all of the features that made the Athlon 64 unique. But there is more: with the launch of the new Core i7 platform (the Core i7 family of processors uses a new socket and runs on a new chipset) Intel basically obsoleted a part of its own product portfolio as well. That is right; Core i7 outclasses current Core 2 processors with substantial gains in absolute performance. The biggest gains are to be had with 3D rendering, scientific and high-performance computing applications and nearly any application that is heavily multithreaded. With some applications the performance of a dual socket "Skulltrail" workstation, having a total of eight processor cores, is not enough to best that of the lowest clockspeed Core i7. That puts Intel in an awkward position because now their highly profitable workstation and server solutions are bested by a consumer platform that is far less expensive. So the question is, do we really need this much performance on the desktop when Joe The Desktop User does not even use 10% of the performance of his 5-year old PC?