Thursday, November 13, 2008

New AMD Chip Intended To Restore Credibility.

New AMD Chip Intended To Restore Credibility.

The Wall Street Journal (11/13, B4, Clark) reports, "Advanced Micro Devices Inc. (AMD) overpromised and underdelivered on its last big product launch. It is determined to reverse that pattern this week, with a new chip dubbed Shanghai." The new element "of AMD's Opteron product line, which serve as calculating engines in server systems, is a successor to a chip called Barcelona that was late to market when announced in September 2007 and had early technical problems." Notably, "AMD's missteps with the Opteron family -- which commands higher prices and profit margins than chips for personal computers -- contributed to big losses for the company this year and helped rival Intel Corp."

The AP (11/13, Robertson), explains that "AMD's new Opteron processors are AMD's first chips based on 45-nanometer manufacturing technology. That means the company has shrunken the tiny parts of the circuits to an average of 45 nanometers wide, or 45 billionths of a meter." Smaller circuitry translates into cheaper chips, which also "can hold more transistors," and, as e result, "boosts performance. "AMD developed its manufacturing process in a partnership with IBM Corp." According to the AP, "AMD still lags Intel in that department, however. Intel has been selling its 45-nanometer chips for a year, an advantage that allowed Intel to maintain healthy profits despite pressure on the chips' selling prices and economic gloom."

IDG (11/13, Shah) notes, "The delay cost AMD market share and credibility, and it must now build back up its reputation as a reliable chip supplier. Some customers may still be a little wary, said Rob Lineback, senior market analyst with IC Insights." Additionally, "the down economy and slowing server shipments could also go against AMD's momentum, said Jack Gold, principal analyst at J. Gold Associates." But "AMD says the problems are all behind it. It hardened the testing process for Shanghai to avoid the bumps that Barcelona faced, said Pat Patla, vice president and general manager of AMD's server and workstation division."

Nathan Brookwood, a semiconductor analyst at Insight64, agrees that "AMD is back on track with the release of Shanghai, (11/13, Oreskovic) adds. But, Brookwood notes, AMD doesn't have any products in its pipeline that will deliver the type of performance advantage to leave Intel in the dust."

According to ZDNet (11/13, Dignan), "overall, AMD is claiming a 35 percent performance boost with up to a 35 percent power decrease -- in certain conditions. AMD has been shipping the chips to original equipment manufacturers for weeks and hardware giants such as HP, Sun, IBM and Dell have systems ready." Sally Stevens, director for platform marketing at Dell For instance, said that "Dell will update eight of its servers with Shanghai." Stevens added that "the latest AMD systems deliver a 49 percent performance boost over their Barcelona counterparts."