AMD: More Persuasive From A System Perspective

Continued from ‘Triple Core: Can AMD Even The Score?‘…

Turn your attention to AMD and Intel’s respective core logic chipsets, on the other hand, and things get far more interesting. Neither integrated graphics core will frankly satisfy a hard-core gamer. But AMD’s Hybrid Graphics technology enables that embedded graphics core to cooperatively tackle the overall graphics processing task with a discrete AMD/ATI GPU; my contact claims that even a low-end $40 graphics card will deliver a dramatic performance boost. And, frankly of greater interest to a non-game-player such as myself, AMD’s graphics core hardware-accelerates a significantly higher percentage of the overall high-resolution video processing pipeline than does Intel’s alternative. AMD’s timing here is excellent, considering the burgeoning popularity of Blu-ray discs and high-def camcorders.

Putting myself in the shoes of a potential PC purchaser, therefore, I’d probably find myself pretty pleased with the AMD-vs-Intel situation right now. A $500 PC with three cores and solid video performance, whose graphics I can easily upgrade down the road? Sign me up. But if I was an AMD investor, I might not be quite so sanguine. The company’s financial bad news continues unabated; as I’ve long suggested, while profit-clobbering aggressive pricing may in the short term be effective at retaining a modicum of market segment share for AMD, it’s not a sane long-term strategy. Slashing headcount, R&D investment and product line diversity doesn’t make for a healthy long-term business, either. AMD’s a full process generation behind Intel, with no gap-closure in sight. And I still get stuck on the thought that, on that process, AMD’s shipping a tangible amount of triple-core Phenom product (which, by the way, doesn’t play at all in rapidly growing mobile PC market segments) with a notable amount of per-die silicon area disabled, therefore non-revenue-generating.

And speaking of dead die area, if I was a PC OEM, I’d probably think long and hard before adding triple-core Phenom-based systems to my product portfolio, no matter how attractive they might look at the moment. One would hope that, over time (and as quickly as possible), AMD’s fully-functional die yields would improve and, therefore, its need to ship core-disabled Phenoms would rapidly dissipate. Once the need diminishes, so too does the motivation; if you were AMD, wouldn’t you rather ship each die as a higher-revenue quad-core chip? Developing, launching and supporting each new system proliferation requires a tangible amount of cost, a critical consideration in the razor-thin-margin PC system business, and being unable to deliver on product promises made to customers is damaging to long-term reputations. Would you be interested in launching a new system line if you knew that triple-core CPU supply would likely be erratic, and would more generally evaporate over time?

Finally, speaking of PC OEMs, I can’t help but smile when I think back to how AMD’s pitch has evolved since buying ATI. Back in the ‘old days’ when AMD didn’t have in-house high-volume production core logic chipset capabilities or graphics expertise, it was all about ‘enabling the infrastructure’. AMD, unlike Intel, didn’t ‘force customers to buy everything from one company’. OEMs had ‘choice’, and ‘a diversity of options made for a more healthy ecosystem’.

Nowadays, in contrast, you’ve still got choice at least with respect to Wi-Fi transceivers, since AMD doesn’t (yet) sell branded chips in this product area. But the CPU-plus-chipset-plus-graphics promotion approach has a very Intel-reminiscent feel to it. To be clear, I’m not being at all critical here. If anything, I used to think that AMD’s prior approach was naive, practically speaking, no matter how good the theory might have sounded. But I’m always amused any time I watch a company practicing revisionist history and hoping that I (like most journalists, unfortunately) won’t remember its prior messaging.

Congratulations, AMD. With triple-core Phenom, especially now that the bugs are squashed, you’ve got an intriguing solution in the mainstream desktop PC space for the first time in a long time. Now please get your financial house in order, so that I can still be writing about you past the end of this decade.