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AMD Backing Out of CPU Speed Wars Against Intel

By - Source: Business Week | B 212 comments

AMD's future is not in making the fastest processors.

The company's CEO has taken AMD on a transitional path that appears to be more disruptive than any other event in the company's history, especially in light of the ongoing change in executive management. There is no interest at AMD to continue a processor war with Intel that has lasted decades, but only rewarded AMD with occasional superiority.

“That era is done,” Rory Read said in an interview and added, “There’s enough processing power on every laptop on the planet today.” Uh oh. Those quotes leave room for speculation that is significant enough to upset an entire loyal customer base of enthusiast users and may not have been the smartest choice of words.

It would be a bit premature to assume that AMD is not developing chips that are at least somewhat performance-competitive, but there is a clear shift in thinking that appears to be moving away from Intel being the focus to the building threat from ARM chip makers, including Nvidia. Instead of being focused on performance, AMD appears to be looking much more on cost and indirectly join a force that is building up against Intel - and especially against exclusionary marketing moves such as the Ultrabook pitch.

“I think we come in and steal the bacon around the whole thin-and-light movement and capture a significant portion of the opportunity there,” Read said.

Of course, he recognizes that AMD has to change as a whole and traditional weaknesses have to be addressed.

“It can be a very different AMD going forward, but we have a long way to go,” he said. “There’s been a passion for innovation but there needs to be a passion for delivery and a passion for the customers.”

That transformation may be done by 2015, according to Read. Given the executive changes we have seen in recent months, it is somewhat apparent that the old blood of AMD has been flushed out and replaced with a new way of thinking. Given the pace Read is driving AMD, the company may have already crossed a point of no return. It's going to be a new era for AMD and it will be interesting to see if it will have a chance to play for the market lead.

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Top Comments
  • 67 Hide
    iam2thecrowe , May 23, 2012 9:21 PM
    Fire that CEO.
  • 58 Hide
    ehanger , May 23, 2012 9:21 PM
    Hello intel monopoly
  • 52 Hide
    eddieroolz , May 23, 2012 9:31 PM
    He has a valid point. Why others cannot see the reason behind this baffles me.

    Yes, enthusiasts will suffer because the highest-end AMD chips won't be/is not competitive with Intel chips. But we enthusiasts represent a minority in the world PC market. AMD is an order of magnitude smaller than Intel is, and AMD simply does not have the R&D money it needs to develop a true contender against Intel architecture - in fact, it's amazing that AMD was able to take a lead for half a decade with their Athlon lineup.

    Instead of pursuing a bloody, costly speed war against Intel, AMD simply decided that focusing on the general consumer market - which represents a HUGE chunk of the world PC market - was the better choice. And this makes sense; normal PCs cost somewhere around $500-600. For every enthusiast PC sold the brick-and-mortar stores sell multiple of normal PCs.

Other Comments
    Display all 212 comments.
  • 58 Hide
    ehanger , May 23, 2012 9:21 PM
    Hello intel monopoly
  • 67 Hide
    iam2thecrowe , May 23, 2012 9:21 PM
    Fire that CEO.
  • 40 Hide
    wiyosaya , May 23, 2012 9:22 PM
    Just shows how clueless the new guy is. IMHO, this will kill innovation at AMD, if not the company itself in due time. For me, though, it is too late. I went Intel after years of building AMD.

    His comments bring to mind those supposedly attributed to Bill Gates what were they? "Who would ever need more than 1K of RAM?"????
  • 25 Hide
    tofu2go , May 23, 2012 9:24 PM
    Quote:
    “I think we come in and steal the bacon around the whole thin-and-light movement and capture a significant portion of the opportunity there,” Read said.


    How does AMD compete on thin and light when Intel's designs are more efficient and manufactured with manufacturing process superiority?
  • 42 Hide
    ram1009 , May 23, 2012 9:24 PM
    This is NOT news. It was announced months ago.
  • 42 Hide
    RealBeast , May 23, 2012 9:26 PM
    Sadly, he's just admitting what has been obvious for a long time.
  • 42 Hide
    N.Broekhuijsen , May 23, 2012 9:29 PM
    ram1009This is NOT news. It was announced months ago.

    Then it's still news, just old news. :p 

    Anyways I've been a loyal AMD builder, and whilst I have no interest in upgrading my machine now I've already felt for a while that my next rig will be "Intel Inside"
  • 1 Hide
    Anonymous , May 23, 2012 9:30 PM
    Guess you could say when AMD fans heard the annoucement they were hopping amd.
  • 27 Hide
    jacobdrj , May 23, 2012 9:31 PM
    Nothing is changing. It is just a shift in the mentality... They don't need to worry about gigahertz... They need to worry about MARKETING and BALANCED PRODUCTS...
  • 32 Hide
    Anonymous , May 23, 2012 9:31 PM
    It's a shame, but it had to happen. AMD cannot compete with intel's size or budget. With no competition, we as consumers will suffer as Intel innovates less on high end computing.
  • 52 Hide
    eddieroolz , May 23, 2012 9:31 PM
    He has a valid point. Why others cannot see the reason behind this baffles me.

    Yes, enthusiasts will suffer because the highest-end AMD chips won't be/is not competitive with Intel chips. But we enthusiasts represent a minority in the world PC market. AMD is an order of magnitude smaller than Intel is, and AMD simply does not have the R&D money it needs to develop a true contender against Intel architecture - in fact, it's amazing that AMD was able to take a lead for half a decade with their Athlon lineup.

    Instead of pursuing a bloody, costly speed war against Intel, AMD simply decided that focusing on the general consumer market - which represents a HUGE chunk of the world PC market - was the better choice. And this makes sense; normal PCs cost somewhere around $500-600. For every enthusiast PC sold the brick-and-mortar stores sell multiple of normal PCs.

  • -9 Hide
    Anonymous , May 23, 2012 9:37 PM
    AMD RIP. Instead of innovating, they've thrown in the towel essentially. The combination of lackluster Bulldozer performance/competition and the Shakey launch of the HD7xxx gpu's( driver/dual monitor issues) makes this a very predictable but sad announcement.
  • -5 Hide
    Cazalan , May 23, 2012 9:39 PM
    "done by 2015"

    AMD to get crushed between higher power ARM SoC's and Intel's 14nm chips.
  • 37 Hide
    willard , May 23, 2012 9:42 PM
    daswilhelmim sorry, when was AMD on the "very very top"?

    About 7 or 8 years ago. Intel was still chasing clock speed and made some really awful chips in the Pentium 4 line. At the same time, AMD made some really awesome chips, and they were the undisputed king for a while.

    Basically, it's the same thing that happened with Bulldozer, except instead of Intel chasing clock speed, it's AMD chasing core count. Intel was also able to leverage their huge manufacturing advantage to widen the gap even more.
  • 3 Hide
    Anonymous , May 23, 2012 9:49 PM
    I better hurry up and order that i7 before the rest of you guys bid up the prices. I don't like this Rory guy.
  • 23 Hide
    loomis86 , May 23, 2012 9:50 PM
    I think the CEO is right, but I think maybe he made a mistake saying it. Stockholders will get nervous. The future belongs to smaller more portable computers. I'm thinking mini ITX format, and smaller, and chips that combine functions. SOC architecture. If I was king at AMD I would get the company into more things besides middle to high end x86 PC CPUs.

    I would want a foundry, for starters. I would want my own foundry that can make ingots in the 18" diameter size and etch chips onto wafers in the smallest size currently considered cutting edge. However, I would not be terribly worried about being the smallest and firstest CMOS foundry because we all know that race is about to end. The future in foundries, in my opinion, is being the quickest producer with the highest volumes, the lowest costs, and highest yields. That means massive ingots and enormous factories and automation of the likes we have never seen.

    AMD needs to break out of the x86 paradigm, do it first, and be the most amazing company doing it. That's how they will beat intel.
  • 18 Hide
    Tab54o , May 23, 2012 9:56 PM
    This sucks I don't want to see AMD give up or fail. I really like having a choice. All companies care about now is owning the market, patent trolling and squeezing every last cent out of consumers. I would really like to be able to choose. I haven't owned a AMD cpu in awhile.
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