There used to be an easy way to tell time in the processor business: AMD would have three bad years and one good year, and Intel would have one bad year and three good years.
Strategic changes and new products such as the Opteron, however, have transformed AMD from a company too often known for gaffes and financial losses into a major supplier of processors. Intel, meanwhile, has tripped over itself several times during the past three years.
Intel is now in a position to reverse its mistakes with a new line of chips. AMD's chief technology officer Phil Hester, however, says that the smaller competitor isn't resting on its laurels. It continues to improve its chips and, with the acquisition of ATI, will release integrated chips for notebooks and other devices.
Will it be enough to keep a reinvigorated Intel at bay? Hester, who worked at IBM for 23 years, believes AMD is ready.
Q: It's kind of an interesting twist that AMD is doing "platformisation" — that is, offering reference designs and more than one part to PC makers — because for years, the idea was to concentrate on processors and let your partners make chipsets.
A: A lot of it is driven by what the OEMs (original equipment manufacturers) have asked us to do. It started off in the mobile space. Last year, for the first time, we did a reference design in the notebook space.
The OEMs would like us to do more of the validation and certification work. Each of them still wants their own unique packaging in the notebook space, but kind of a core design, if you will, that's been validated. So we work with two or three wireless vendors, a couple of graphics vendors, and then make sure we pick selected elements from that.
But they don't like the Intel approach of saying, "You can only do this one, this one and this one." They want us to be able to say, OK, we validated with these — let's say, three wireless chipset vendors and these two graphics vendors.
How come you didn't do it five years ago?
A lot of this came out of what we call the commercial stable image platform business. In the commercial marketplace, they want a more rugged, robust platform than on the consumer side of things. And it really grew out of some of our success in the commercial side, which was driven by Opteron. Before that, to be honest, we were not taken seriously in the commercial side.
AMD has always wanted to get into the enterprise with notebooks and desktops. Why has it been tougher than it was with Opteron?
It's a work in progress. I think you've seen some major OEM announcements about going into the commercial space, and there are others in the works. Watch this space. It's clearly a focus for us, but it's an area where historically we were not stronger.
Are there any OEMs waiting in the wings with AMD PCs for the Fortune 500 crowd?
I think there are a couple that would be recognised worldwide, tier-1 names that have products under development. Obviously I can't be too specific; you know, there are at least two that are well-known names that would have products.
The history of AMD and Intel is interesting. For a long time, AMD was the company that could do no right, and Intel would always be breathing down your neck when AMD stumbled. Why is it no longer the case?
I think several things. There's been a lot of learning inside AMD, both at the technical level and management level. [Chief executive] Hector Ruiz did a good job of reinvigorating the executive team at AMD and became a more predictable company that the tier-1 [computer makers] can trust as a strategic partner.
The other half, of course, was that we have the product from the technical team. The Opteron got us in the door. You can show a slide where you say why you're going to be a great company, but until you have a real product, people are always going to be suspicious.
Are you going to do platformisation for commercial desktops?
Yes, we expect to.
With a variety of different chipset partners or with your new friend ATI?
Same platform choices as before. We have no intention of trying to exclude anybody. Obviously the relationship with ATI will be much stronger, but we would have no intention of locking anybody out if they wanted to provide solutions to our platforms.
Are you talking to Apple?
We have.
Has it shown any interest?
I'd say interest, not necessarily any decisions.
What are your longer-term aspirations in the server market? Is there any thought of doing a high-end, x86 chip that includes reliability features and capability features that a regular Opteron or Athlon may not have?
In general, the features we add have played well in the server space and client space. There's more benefit in the server space, but it's more difficult…
