For a long time now, AMD has been a thorn in Intels side.
Just the other day, I mentioned how Intel has started to strike
AMD earnings by lowering prices on its CPUs. So if AMD is starting to have a hard time
beating Intel to market with faster processors and can be sent into the red
with a wave of Intels hand, how can it compete?
One good strategy is to hit em where they aint. Or at least where they aint as strong. To
that end, AMD recently decided
to buy ATI to put itself right in the middle of the graphics card market. Intel
markets some graphics chipsets, but usually theyre included on motherboards.
Usually Intel graphics chips arent found on separate cards. Thats where ATI
and nVidia currently rule.
ATI has been around for a very, very long time. While other
graphics makers like S3, Diamond, Trident, and others have crashed and burned
along the side the road, ATI has always been a reliable, if not always
top-performing, chip maker.
For AMDs sake, buying ATI is a pretty cunning move. Beyond
the talk about the union being able to create a computer on a chip, the
marriage seems pretty natural. AMD has been chasing the graphics market ever
since introducing the 3DNow technology into their K6 CPUs. ATI is a perfect
extension to those efforts. In addition, with the amount of graphics power
needed in Vista in order to get Aero Glass working properly, ATI and nVidia chipsets
are both only going to be more in demand in coming years.
Mergers are always difficult things to pull off however. AMD
will have to tread lightly in order not to mess ATI up in the short term while making sure that it gets the most out of its investment before Intel can react. Thats probably why theyre doing it before Vista ships.
Intel has also come close to putting AMD out of business several times by
cutting prices. So the timing of the merger is crucial to keep Intels price
pressure and more rapid innovation from permanently sidelining AMD while putting AMD in the position to really take off once Vista ships.
Ive always liked AMD CPUs. Every computer Ive built for
myself at home has used AMD chips. And Ive always stuck to using ATI video
cards because you can always be assured that the company will be around to get drivers and support later. Im
looking forward to see how AMD/ATI is going to fare against Intel in the