AMD to Acquire ATI

By John G. Spooner  |  Posted 2006-07-24 Print this article Print

Updated: AMD intends to create a PC chip powerhouse to rival Intel.

Advanced Micro Devices will acquire graphics processor maker ATI Technologies in an effort to emerge as a more formidable supplier of chips for business computers.

AMD has traditionally worked with multiple partners whose chips can be used with its processors to build PCs. But the company intends to use the tie-up, announced on July 24, to deliver more tightly integrated processors and supporting chip sets, in an effort to lure more businesses.

AMD has made strides with businesses of late, particularly in the server space. Its Opteron server chip has claimed more than a quarter of server processor shipments, thanks to partnerships with companies such as Hewlett-Packard, IBM and Sun. It has also won major PC deals. However the company—whose goal is to serve at least one third of the PC processor market in the future—says it still needs to do more to gain businesses' loyalties in corporate PCs, a market where Intel continues to dominate.

"Mobility and commercial are [the] most immediate areas for growth" for the combined AMD-ATI entity, Hector Ruiz, AMD's CEO, said during a conference call with analysts. "For us to be able to [grow in those areas], the one thing our customers were insisting on is we had to play a bigger role in the ecosystem of those products."

Read the full story on eWEEK.com: AMD to Acquire ATI

John G. Spooner John G. Spooner, a senior writer for eWeek, chronicles the PC industry, in addition to covering semiconductors and, on occasion, automotive technology. Prior to joining eWeek in 2005, Mr. Spooner spent more than four years as a staff writer for CNET News.com, where he covered computer hardware. He has also worked as a staff writer for ZDNET News.

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