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Or so they say...

Well, we’ve heard rumor after rumor that Dell would eventually consider using AMD processors. Everyone dismissed the rumors and said that the analysts were blowing smoke. Eventually, Dell caved and announced that it would use Opteron processors in some of its server systems. Well, everyone loves a good rumor and this one is a whopper. Forbes is confidently reporting that AMD may be in talks to buy ATI Technologies, claiming that an "AMD-ATI Merger Looks Likely."

ATI employees have been talking and analysts are buzzing about the possibility of an AMD-ATI merger. "The synergies of this seem consistent with the recent announcements by AMD to significantly increase capacity over the next few-years. We believe ATI is a rare-buy in the semiconductor space right now given the near-term tie-up dynamics," said analyst Apjit Walia.

AMD and ATI are already closely linked together as ATI provides integrated chipsets for AMD desktop and notebook chip offerings. ATI's recently announced Radeon Xpress 1100 and 1150 chipsets provide DX9-level integrated graphics capabilities for AMD's new AM2 processors. And chances are if you purchase an AMD based notebook, you’re going to find an integrated ATI chipset under the keyboard. But while ATI has the upper hand in the mobile sector with AMD systems, NVIDIA clearly is the leader on the desktop side of things. It remains to be seen what an AMD-ATI merger would do for the desktop market.

But does a merger between AMD and ATI really make sense at this point in time?  Forbes reports:

Walia based his prediction on recent checks in the PC food chain. RBC has an "outperform" rating and $23 price target on ATI, and no rating on AMD. The firm expects ATI to report fiscal 2007 earnings per share of $1.06. It has long been discussed that the graphics-companies are likely to be bought by one of the microprocessor companies, according to Walia. However, for AMD-rival Intel, a partnership with a graphics company may not be the best idea.

Thanks to Ryan Shrout and mAdD INDIAN for sending in this news.  Of course, Forbes has been wrong before.


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i don't think so.....
By ncage on 5/31/2006 1:02:41 PM , Rating: 2
Ill believe it when i see it. I read something on tomshardware yesterday about microsoft buying ebay which i don't believe either. I don't think these mergers make much sense but when nvidia was in the graphics business who would have ever thought they would get into the chipset buisness.




RE: i don't think so.....
By CoolDK on 5/31/06, Rating: 0
RE: i don't think so.....
By Fenixgoon on 5/31/06, Rating: 0
RE: i don't think so.....
By George Powell on 5/31/2006 2:09:20 PM , Rating: 2
Although technically it would be possible, there would be serious legal issue over the anti competitve nature of such a thing.

On the other hand chipsets that offered better performance would be far more acceptable, not least because chipsets tend to support only one cpu type and in the case of SLI and crossfire only one gpu manufacturer for high end graphics.


RE: i don't think so.....
By GoatMonkey on 5/31/2006 1:15:11 PM , Rating: 2
ATI is making AMD chipsets now also. The nVidia chipsets seem to be much better in my opinion though.

It sort of makes sense if AMD is considering branching out to building nearly complete computer systems. After that they would just need a storage division or another merger.



RE: i don't think so.....
By bunnyfubbles on 5/31/2006 3:31:41 PM , Rating: 3
Your opinion wouldn't be so black/white if it matched the facts. ATI chipsets are right up their with nVidia for AMD platforms, in fact, some of the best s939 boards features ATI chipsets...

However, I don't know if such a merger would be that great for everyone involved. AMD would essentially start competition up with one of their bigger supporters - nVidia. Not only is there that possible alienation, if AMD/ATI continues to produce GPUs, then the merged company would most likley be playing second fiddle in both the CPU and GPU realm, I'm not so sure you want to be facing a double uphill battle


RE: i don't think so.....
By bob661 on 5/31/2006 4:44:41 PM , Rating: 2
quote:
ATI chipsets are right up their with nVidia for AMD platforms, in fact, some of the best s939 boards features ATI chipsets...
I see no facts in this statement either.
Anywho, I believe AMD would be looking for an in house chipset manufacturer as well as integrated video manufacturer. Think Intel.


RE: i don't think so.....
By Praxis1452 on 5/31/2006 8:04:40 PM , Rating: 2
What did he say was wrong? ATI chipsets are used in top of the line motherboards such as the CFX3200-DR and the A8R32-MVP both equivalent to their nvidia counterparts.


RE: i don't think so.....
By Googer on 6/1/2006 1:30:26 AM , Rating: 2
quote:
Anywho, I believe AMD would be looking for an in house chipset manufacturer as well as integrated video manufacturer. Think Intel


AMD already has made their own chipsets for Athlon XP and still makes a few in limited quantities for the Opteron. AMD has said in the past that making core logic is not where they want to focus and would rarther have third parties do that work for them. They have the capability but choose not to use it.


RE: i don't think so.....
By hstewarth on 5/31/06, Rating: 0
RE: i don't think so.....
By Trisped on 5/31/2006 1:36:17 PM , Rating: 2
ATI actually has more in the non-gaming market then NVIDIA, not to mention their partnership with Intel.


RE: i don't think so.....
By johnsonx on 5/31/2006 1:41:09 PM , Rating: 2
ATI doesn't make chipsets?

NVidia's chipsets may be more popular at the moment, but ATI's chipsets have been maturing rapidly. Also, like the article says, for notebooks ATI pretty much is the only game in town... you buy a Turion 64 notebook, and there's ATI under the hood. NVidia notebook chipsets seem pretty much non-existent. Dominating the AMD notebook chipset market and having up-and-coming products in the desktop market is fine by ATI (and AMD too), since there's more money to be made in the notebook market.
ATI doesn't have anything in the server space, but that could be remedied quite easily if AMD were to buy them. AMD does actually know how to make a chipset; when they had to do it, their 760 and 760mpx chipsets were quite good at the time (lets not discuss the 750... it was never meant for actual production or consumer use, but VIA dropped the ball so AMD was forced to produce it).


RE: i don't think so.....
By johnsonx on 6/1/2006 3:17:17 PM , Rating: 2
I don't know about this comment posting engine.... I'm about 100% certain that I clicked on the Reply button for the post a bit below titled 'Meh...', where the OP claimed if AMD bought NVidia they'd get graphics AND chipsets... thereby implying ATi doesn't make any chipsets. My comments make little sens in the 'i don't think so....' thread.

This isn't the first time, or even only the 100th time, that someone has complained about the comment engine here at DT. Fix it!


RE: i don't think so.....
By killerroach on 5/31/06, Rating: 0
RE: i don't think so.....
By Viditor on 5/31/2006 1:59:27 PM , Rating: 5
quote:
If an AMD-nVidia link were to happen, it would be nVidia buying AMD, not the other way around

Nvidia is worth $8 billion, and AMD is worth $15 billion...


RE: i don't think so.....
By z3R0C00L on 5/31/2006 5:13:29 PM , Rating: 2
ATi is worth more then nVIDIA. ATi owns more assets and an overal larger marketshare then nVIDIA.


RE: i don't think so.....
By Viditor on 6/1/2006 3:24:23 AM , Rating: 2
quote:
ATi is worth more then nVIDIA

No, actually ATI is worth half of Nvidia...
Nvidia has a market cap of $8 billion, and ATI is $4 billion.


Meh...
By jskirwin on 5/31/2006 1:06:39 PM , Rating: 2
Maybe I buy it, maybe not.

Synergies, huh?
By synergies I take they mean "stuffing fistfuls of shareholder wealth into boardmember pockets."

Beyond that I don't see what value AMD gets from ATI. Nvidia would appear a better fit, since AMD would get its hands on graphics tech AND chipsets.




RE: Meh...
By Viditor on 5/31/2006 1:35:37 PM , Rating: 2
quote:
I don't see what value AMD gets from ATI. Nvidia would appear a better fit, since AMD would get its hands on graphics tech AND chipsets

ATI also makes chipsets (it's about 15-20% of their income).


RE: Meh...
By Viditor on 5/31/2006 1:37:59 PM , Rating: 4
The problem with an ATI/Intel merger is that Intel is a huge manufacturer of both graphics chips and chipsets too...it would be quite difficult to get the DOJ to approve the deal.


RE: Meh...
By Viditor on 5/31/2006 1:43:26 PM , Rating: 1
A note to our sponsors, DT...

Guys, this system keeps grabbing the wrong post when I reply.


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