ATI - massive job cuts?

[AlexV]

nV would`ve been even more expensive I think, and probably more troublesome to aquire. And we don`t yet know how ATi will help/hurt AMD, it`s too early to tell, basically they`re still doing their stuff, full business integration is still a bit off.

 

[Arun]

nV would`ve been even more expensive I think, and probably more troublesome to aquire.

I'd say VIA would have been a much better fit. They didn't have the advantage of a discrete GPU business for bundling there, but it was clearly better in every single way besides that. VIA has had that "massive integration, minuscule size and costs" vision for years. Heck, their CPU lead is the guy who pretty much CAME UP with that whole vision, as strange as that might sound: http://www.eetimes.com/news/latest/showArticle.jhtml?articleID=170701835

The problem with VIA is it's just not very attractive when it comes to chipset and GPU bundling. In the end, a joint venture with VIA aimed at specific markets might have been their best bet (that'd also have had the advantage of not instantly killing VIA's Intel chipset business!), but that kind of thing is very hard to judge without all the information at our disposal.

And we don`t yet know how ATi will help/hurt AMD, it`s too early to tell, basically they`re still doing their stuff, full business integration is still a bit off.

If AMD's margins go down so that they don't profit quite as much as they did with their CPUs, how does it even matter if they can bundle to increase their market share? Especially so if they're not gaining much money on the other things they're bundling in too!

From a marketshare point of view, you are perfectly right: we can't say yet how things will work out yet. From a financials point of view, I think it's much easier to judge already, and I think I pointed out my opinion quite clearly about that above. If AMD begins to bleed for cash and loses all investor confidence, their only shot will be to try to hurry Fusion out of the door. And if that happens, it sure as hell better be all it's hyped up to be, otherwise I'm not sure where they'd want to go from there.


Uttar

 

[Dave Baumann]

nVidia could have pulled them through. ATI absolutely will not, and I think that was nearly obvious.

The debt that NVIDIA would have brought them would have been significantly greater - your sure the profits NVIDIA brings out have been able to outweigh the debt? (Hint: This one has already been decided)

 

[nonamer]

The debt that NVIDIA would have brought them would have been significantly greater - your sure the profits NVIDIA brings out have been able to outweigh the debt? (Hint: This one has already been decided)

I never said NV would have been feasible to acquire. It wouldn't have been financed through debt but a stock swap of some sort if they had tried it. Obviously, they didn't because they didn't have the resources to do so or wasn't willing to dilute their own control of the company.

 

[overclocked_enthusiasm]

Nvidia would have been the more logical choice for many reasons.

1. Close working relationship with AMD
2. Intel haters...no Intel business to lose
3. Fat juicy margins of 40% +...positive cash flow from the start
4. A combined Nvidia/AMD would have likely put even more pressure on ATI and produced even greater market share gains for Nvidia


The problems with the aquisition?

1. The price would have been at least $12 billion...over double ATI.
2. Jen has a HUGE ego and would have asked for the moon as far as the price and his position within AMD/Nvidia was concerned.

There is a theory, that I support, that AMD tried to purchase Nvidia well before they aquired ATI. The timing of this was at a MUCH stronger time for AMD share price and technology leadership (pre Conroe) but they couldn't get the deal done. That is why the ATI deal feels late, at least to me, and seems like a head scratcher to many.

The two biggest "why in the heck did they do that?" questions in the PC/semi market recently for me have been:

1. Apple goes with Intel to replace IBM for processors. Are you kidding me? AMD is lower power, higher performance and Steve Jobs is supposed to be savy about tech? Intel must have bought him off and God knows what else. Little did we know that Intel showed Stevie boy the goods before they were released...Conroe...Core2Duo. He was smart after all and we were just in the dark.

2. AMD buys ATI? Are you kidding me? AMD loves Nvidia! AMD and Nvidia are almost cobranded in most gaming rigs and tech sites. ATI=Intel...AMD=Nvidia....everybody knows that! Well it seems AMD DID try and buy Nvidia first but the price was too high and maybe Jen wasn't selling. So they settled for the runnerup...ATI. That makes more sense now to me.

 

[3dilettante]

I'd say VIA would have been a much better fit. They didn't have the advantage of a discrete GPU business for bundling there, but it was clearly better in every single way besides that.

I'm not up on the legalities, but could there have been some line somewhere in the mass of cross-licensing agreements between AMD and Intel over the x86 license that would have made it difficult with VIA having an x86 license of its own?