Space Ramblings

AMD’s Wrong Turn

Intel is tied to Israel with an extensive plant and research on the ground and the Abu Dhabi government seems to have decided its wants some of that hot chip action and spent over half a billion dollars for an eight point one percent stake in AMD. A few years ago that might have been a brilliantly providential move. Today as AMD is still reeling from its disastrous ATI acquisition, it’s more like buying Mrs. O’Leary’s cow after she was already set on fire.

AMD’s whole problem is that it tried to get too big too fast and saw itself as competing with Intel instead of simply producing affordable, low cost and high performance chips. Now AMD is about to sink that money into innovation, but what it really needs to do is streamline its operation, go back and rethink. The ATI disaster happened because too much ambition swamped the realistic understanding of what a marriage of two such companies would like. Today ATI cards are a joke and Nvidia has become the default standard and AMD itself continues to fall behind to Intel and thus becoming non-competitive in two fields rather than just one.

While AMD continues trying to use graphics as a wedge against Intel, it forgets that AMD can’t beat Intel until it gets its own house in order. AMD needs to go back to basics, rethink and abandon grandiose plans at overshooting Intel and controlling the market in favor of focusing on what it has always done best, wise spending, smart production and being a cheaper and better alternative product to Intel.

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