Looking For The Other Half
Right around the time I was speaking with Dave Orton, AMD founder Jerry Sanders was stepping down to begin his well-earned retirement. Since just after its founding in 1969, Sanders had led AMD through over three decades of highs and lows, cementing its place as the only major rival to Intel in the global CPU market. Sanders hired Hector Ruiz away from Motorola Semiconductor in 2000 to become his right-hand man (as president and COO) and next in line for the CEO's chair. Two years later, Sanders took his final bow and Ruiz seized AMD's steering wheel.
Meanwhile, Dirk Meyer, a former processor engineer for DEC and Intel, was rising through AMD's ranks. Meyer led the team in 1998 and '99 that produced the Athlon (K7), a design so successful (and based on a bus derived from DEC) that AMD crushed the then-leading Pentium III and beat Intel to the 1 GHz threshold.
In 2003, AMD followed up its Athlon success with the K8 (Hammer) architecture, which almost immediately trounced everything Intel had going in the server market. Intel’s NetBurst, far from realizing its 10 GHz aspirations, turned out to be a blistering disappointment as Intel slowly began to realize that efficiency trumps brute force. Intel didn’t have a follow-up ready until 2006, when it released its Core architecture, which in turn presaged the groundbreaking Nehalem design of 2008.
We all know that the Fates are fickle in technology. Everything ebbs and flows. If Athlon lit the fuse under AMD, Hammer took the company into orbit. By 2005, Ruiz sensed it was time to try and outflank his bigger competitor. That December, Ruiz elevated Dirk Meyer to chief operating officer of AMD’s microprocessor business, effectively making Meyer number two in the company. By that time, the two of them understood that having graphics on the northbridge was good...but not good enough.
According to Forbes, AMD approached Nvidia about merging. As we go forward in this story, consider the element of personalities and corporate cultures, and ask yourself if AMD could have survived such a mix. The answer is likely found in Nvidia’s response: CEO Jen-Hsun Huang was willing to entertain the idea, provided that he would be the chief executive of the resulting organization. Ruiz, at that point feeling on top of the microprocessor world, understandably went looking elsewhere.
In July of 2006, AMD announced that it would buy ATI for the princely, almost hyperbolic, sum of $5.4 billion at a time when AMD was worth somewhere shy of $9 billion. According to Joe Macri, who was then ATI’s director of engineering and another Silicon Graphics alumnus, it was a "grand vision" spawned from Dave Orton and Dirk Meyer.
"There was a lot of risk on AMD’s part," says Macri, now as AMD’s product chief technology officer. "But there was a lot of courage between Dirk and Dave. They could see a future of the need to converge the CPU and GPU in a way that would allow it to be treated as a unified compute model. That initial vision sounded simple. It started with a big business deal that was quite the effort to pull off. And then they brought us together as leaders and said, ‘Do it!’"
"Quite the effort" is an understatement of epic proportions.