Microsoft had already voiced its opinion in the AMD press release when Jim Allchin, Co-President of Microsoft’s Platforms and Services Division, claimed "We're excited by the potential of what AMD and ATI can deliver together to enhance the Windows Vista experience for our customers even further." Since it may take years for the AMD takeover to really kick into effect, it may take some time for customer-ready products to hit store shelves.
The addition of in-house core-logic also strengthens AMD's presence in the
server market. A portfolio manager for AMD, who wishes to remain nameless
for now, told DailyTech "[I] doubt AMD will have the price flexibility to
bundle ATI chipsets (18% gross margin) until they bring the manufacturing
in-house. Available capacity for that is still down the road." The
same manager went on to claim that without total reliance on Broadcom for
server core-logic the company will have much better success securing major
deals for large quantities of server products. All of these products will now be obtained
through the single AMD channel instead of multiple vendors -- the company previously prided itself in diversification of channel solutions until the Dell picked up AMD to provide server products.
The deal still needs to receive approval from the AMD and ATI shareholders, and
then pass FTC and Canadian Competition Bureau approval. AMD recently announced
that the company would cut
back its Geode research, while almost simultaneously selling the AMD Alchemy division.
This departure of low-end x86 and non-x86 presence is in stark comparison to ATI's recent purchase of
Bitboys Oy. Many of the Alchemy processors AMD recently spun off
competed (at least indirectly) with ATI Imageon products -- many of which will show up
in the new Nokia devices and digital TVs. AMD will also gain a significant presence with
the Microsoft XBOX team, as ATI designed the XBOX 360 graphics processor and
the XBOX 360 HD DVD
quote: It is smaller in terms of market share though