AMD sitting out smart phone market

Advanced Micro Devices Inc. is not immediately chasing the market for smart phones as it does not align with the company’s strength in technologies like graphics, an executive said on Monday.

Smart phones are constrained on battery, pixels and screen space, and AMD has other areas it can focus on in order to grow, said Rick Bergman, senior vice-president and general manager for AMD’s product group during the Pacific Crest Securities Technology Leadership Forum in Vail, Colo. The company sees an opportunity to apply its graphics and chip technologies to tablets, where customers are demanding better video and battery life.

“We haven’t announced any plans to go in that handheld space. We’ve got plenty of opportunities … in server, notebook and now tablets, that’s our immediate focus. But if the right circumstances come up and we can see a way to impact the market, we’ll obviously continue to look,” Bergman said.

AMD has faced criticism for not aggressively pursuing the booming smart phone or tablet markets. The company in June rushed to release its first dedicated tablet chip, called the Z-series. The chip is a low-power variant of PC chips based on the Fusion microarchitecture, which includes a graphics processor and CPU on a single chip. Based on the x86 architecture, the chip can help tablets deliver a full PC and graphics experience, the company has said.

AMD will join Intel Corp. in an attempt to unseat ARM Ltd., which dominates the tablet market. Intel is also pushing the x86 architecture to tablets with its Atom chips, and hopes to reduce chip power consumption over the next few years to a point where it can match ARM, whose chips are considered more power-efficient. Intel is also entering the smart phone market with Atom, though there is no “Intel Inside” smart phone yet, and the company is considered to be many years away from making any meaningful impact.

Earlier this year, rumours emerged that AMD was pursuing an ARM licence, which were ultimately denied by AMD. AMD has not announced anything related to ARM, Bergman said, also reiterating the company’s commitment to x86 architecture.

“We’re excited about what the tablet market can do for AMD,” Bergman said.

Beyond tablets, AMD this quarter will release server and desktop chips based on its new Bulldozer architecture, which has been in development for around five years. The Opteron server chip based on Bulldozer, code-named Interlagos, has up to 16 cores, and will be up to 40 per cent faster than existing chips with up to 12 cores, while consuming the same amount of power, Bergman said. The desktop chips include up to eight cores and will be used in high-end desktops aimed at uses such as gaming.

The Interlagos chip provides AMD with an opportunity to gain back server market share from Intel, Bergman said. Beyond more cores, Opteron chips will provide a power-performance advantage for tasks ranging from cloud to high-performance computing, Bergman said. AMD’s Interlagos chips could also reach market earlier than Intel’s newer Xeon server chips, which could help gain back some market share.

“We frankly look back over the last couple of quarters, we’ve been disappointed with the results we’ve seen from our server businesses as we ceded some market share there,” Bergman said.

AMD gained processor market share during the second quarter, but lost server market share, IDC said in a study last week. AMD had a 20.4 per cent overall microprocessor market share, gaining from 19 per cent in last year’s second quarter, while Intel had a 79.3 per cent market share, down from 80.7 per cent. However, AMD’s server microprocessor market share slipped to 5.5 per cent from 6.5 per cent a year, while Intel dominated with a 94.5 percent share.

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Jim Love, Chief Content Officer, IT World Canada

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