AMD needs money?

[silent_guy]

It doesnt just produce on the leading edge and retool, it sells the older capacity to many many other firms for years years later. Sure, Intel may produce chipsets at .13 or something, but TSMC is probably still cranking stuff out at .35.

Geeforce,

I think Voltron's remark is critical: you'd be amazed how many 180nm chips are still being produced at mass volume, with no end in sight, so depreciation can be spread over a much longer time.
AMD doesn't have that luxury. Your leasing example breaks down in that case: Nvidia can lease for a short time the cutting edge technology, and then move on to the next. TSMC can depreciate equipment over a longer period and lower initial prices to keep its customers competitive. Meanwhile AMD has to buy the fab, use it for a short time, and upgrade after that. It doesn't have products that it can milk for years to come.

Also, it may well be that TSMC customers can't request highly tuned custom processes, but the GPU business is so much more diverse and fast moving that the vast majority of logic remains in standard cell anyway. Once you're in that situation, fab tuning really won't help that much (with standard cell, wire delays are a much larger part of overall speed than with custom.) Given the amount of manpower required, it's very unlikely that AMD will transition to full custom for their GPUs.

With new fabs costing around $2B or more, I think it would be lunacy to build your own unless your revenues surpass that by an order of magnitude. At the end of the day, former ATI and Nvidia are still small players in the world of semiconductors.

 

[_xxx_]

It doesn't have products that it can milk for years to come.

Actually it does, loads of embedded stuff, flash etc. Nothing B3D users usually would buy

 

[Geeforcer]

Geeforcer ,

I think Voltron's remark is critical: you'd be amazed how many 180nm chips are still being produced at mass volume, with no end in sight, so depreciation can be spread over a much longer time.
AMD doesn't have that luxury. Your leasing example breaks down in that case: Nvidia can lease for a short time the cutting edge technology, and then move on to the next. TSMC can depreciate equipment over a longer period and lower initial prices to keep its customers competitive. Meanwhile AMD has to buy the fab, use it for a short time, and upgrade after that. It doesn't have products that it can milk for years to come.

You can solve that if you have enough fabs "in flight" and by renting out excesses capacity: Fab0 is being retooled for 45nm, Fab1 is producing product A at 65nm, Fab2 is producing products C and B at 90nm, Fab3 is producing at 180nm with half its capacity rented out. That way you can achieve the same depreciation schedule as TSMC without paying them any fees and retaining control of the process without having to battle everyone else for capacity. Of course it's a massively expansive proposition that only the wealthiest can afford. I firmly believe that if AMD wants to be truly competitive with Intel in the long run, they need MORE fabs, not NO fabs. Whether they can afford them is another question altogether.

 

[silent_guy]

I firmly believe that if AMD wants to be truly competitive with Intel in the long run, they need MORE fabs, not NO fabs.

I can accept that they need as many fabs as needed to cover CPU volume for pure technical reasons. (Assuming there are no 3rd party suppliers able to do the same.)

Whether they can afford them is another question altogether.

Which is, of course, title of this whole thread.

 

[silent_guy]

Actually it does, loads of embedded stuff, flash etc. Nothing B3D users usually would buy

Flash used to be their biggest non-CPU business, but was spun off as Spansion.
I doubt the remaining stuff is enough to fill up ancient fabs, but I have no numbers to back that up...

 

[Blacklash]

They'll be getting a few of my dollars when the R600 is released.

 

[Razor1]

http://www.tgdaily.com/content/view/31562/137/

well they certainly lost alot in retail marketshare.

 

[Arun]

I received a PM about this, so the reason I closed this thread is that for consistency's sake, I figured it was more logical to continue this discussion here instead: http://forum.beyond3d.com/showthread.php?t=40455

I know this thread became relatively active on its own, but I figured there was no inherent reason why it was, just that it was a subject people wanted to talk about (obviously!) so that it wouldn't matter shifting the discussion to another thread. If anyone has any specific reason to want to keep this thread open instead, please let me know!