It is a distant second to Intel Corp., but Silicon Valley's Advanced Micro Devices Inc. promised to build a “processing powerhouse” when it bought Canada's largest computer chip player last year.
Wednesday, AMD unveiled the first product from its acquisition of graphics chip designer ATI Technologies Inc., saying it represents the initial step toward fulfilling the goal of the $5.4-billion (U.S.) deal.
The product is an AMD chipset that includes a graphics chip from the company's new ATI division. Chipsets are a collection of circuits in a personal computer that link memory and other features to the machine's brain, the microprocessor.
Intel already sells chipsets that integrate its own graphics. Although they are not the most powerful graphics in the industry, they have the advantage of being part of a complete and stable platform of Intel technology.
AMD's latest chipset, known as the 690 series, was developed by engineers in Markham, Ont., at the former headquarters of ATI and gives the company its first combined platform.
“It helps because we can deliver features that span across chips now,” said Phil Eisler, vice-president and general manager of AMD's chipset division. With consumers expecting their computers to perform more complicated tasks, such as handling high-definition video recordings, it has become more important to control both the chipset and the microprocessor design in order to optimize the software between them, he added.
“This way the customers have one neck to choke if there's problem. So we can come in and solve problems for them regardless of where it is in the computer,” Mr. Eisler said in a phone interview from the company's headquarters in Sunnyvale, Calif.
AMD's chipset has been engineered to handle both high-definition formats, Blu-ray and HD DVD, as well as HDMI, a specification used by cable companies for combining high-definition video and audio signals on television sets. The chipset also supports three-dimensional graphics used in games and Microsoft Corp.'s new Vista operating system.
“The idea from AMD's perspective is to give customers a better Vista experience than using a normal integrated solution,” said Samir Bhavnani, research director at the consultancy Current Analysis in San Diego.
AMD will sell its latest chipsets to PC component suppliers and eventually PC manufacturers themselves for less than $20 each. While the profit margins are much lower on chipsets than microprocessors, AMD wants to use some of the technology behind its new chipset to help it eventually combine the microprocessor and the graphics chip into a single piece of silicon. This feat would create more powerful performance using less power.
The company is investing research and development into the project, called Fusion, and expects to have a product to market ahead of Intel some time in 2009.
Wednesday's chipset announcement is “a stepping stone to this grand adventure of the merger [of the processors] and really the reason for the acquisition,” Mr. Eisler said.
