Why Lisa Su and AMD should not issue a response to CTSlabs

Joseph Sugarman[1] adopted a marketing tactic[2] that goes like this:

Suppose that everyone believes Nikon is the best camera that a consumer or a low level pro can buy. Nikon has spent hundreds of millions in research and development to get their cameras where they are. They spend a lot of promotional money (big money) to keep that brand recognizable.

So someone like Sugarman comes along and says, how can I make money off Nikon? So he finds a competent Japanese company that can make an excellent camera, but without a well known name. He checks it out. It is pretty good. Maybe not quite Nikon, but a good value. So he puts some new name on the product, and then he takes out full page ads that read something like this:

JS&A XD7500 camera offers Nikon $5 million if Nikon D7500 can beat the JS&A XD7500 in a fair contest

The ad features a picture of the camera, and a picture of the $5 million check. It also spells out that there will be a variety of models and scenery that represent normal photographic and lighting conditions. It will also suggest a panel of judges from photographic societies and magazines.

This game has been played again and again with audiophile equipment, radar detectors, fast cars, tires, you name it. The number of times that the big name has taken the bait is exactly zero.

Here’s what happens. The challenge is never answered. The knock-off product gets a big jump in sales because it looks like the big name is afraid of the challenger.

Here’s why no one takes the challenge: Even being in the same contest with the challenger gives some credibility to the challenger. Even if the big name accepted the challenge, JS&A only loses a check but still gets publicity for it. If by some chance the big name took the challenge, what would happen? The scoring has been set up so that scores will be close. The big product gets a score of 95 and the challenger gets a score of 91. At that point a lot of people will say: “I don’t have $2000 for the Nikon, but at $800, the JS&A is almost as good.” The challenger still does not lose. But JS&A never expects to have to pay out on the check. The big name is not ever going to take the challenge.

Now this tactic is exasperated exponentially in a scenario where this knock off product (or researchers) are able to profit in the short term - shorting the stock-, and in the long term earning credibility and free advertising.

The “Issue a response to the 'vulnerabilities'.... (that requires root access) ” tactic is the same approach of issuing a no win challenge to the target. The pay off: Ammunition to help sell future "tech vulnerabilities", "white papers" , "short selling clout" (see CitronResearch). If the companies do not take the bait, they look afraid. If they do take the bait, the "researchers" will come out with more lies and have pundits (supposed human behavior experts) who will say, “Look on the video. He blinks just at the instant he said ‘xyz’ which of course means he is lying.”- you get the idea.

They will say “Any fool can see that this is not sincere. Why did they even have to address it."

The whole thing is just a way to sell reports(and obviously make money short selling), and if you have to ask this question, you are buying it. Go send all your money to these researchers, go sell all your stock. They are laughing at you all the way to the bank. These same guys are playing both ends of the game. They also have reports that claim the chips are not vulnerable. Of course, they use a different name to publish those reports. If you don’t like people behaving that way, don’t make it profitable for them.

In short, researchers claim that AMD's chips have vulnerabilities that make them accessible to hackers. The fine print will let you know this can only happen with root access. That is like saying they can read all your cell phone text messages IF they get your phone and passcode. The only thing a response to this hit piece would do is give CTS labs credibility, and future projects.

[1] Turn Copy into Customers-7 Lessons from the Legendary Joseph Sugarman

[2] Popular Science - Google Books