AMD-ATI ‘Fusion’ Full Speed Ahead

AMD’s $5.4 billion acquisition of graphics chipmaker ATI became official today, and it didn’t
take long for the Sunnyvale, Calif.-based company to go on the offensive with its product plans.

In a briefing with, AMD
 expressed confidence its plans to integrate ATI’s
technology with its CPU line, a project it calls Fusion, will be a
key development for the industry, consumers and corporate computing.

The potential advantages include power savings and lower-cost PCs.

Marty Seyer, senior vice president of AMD’s Commercial Business Unit,
said the plan is to produce first silicon of the integrated CPU with
graphics by late 2008, with products available for shipping in 2009.

“We’ve proven we know how to integrate technologies and not be
disruptive,” said Seyer. “We extended the x86 when our competitor said it
couldn’t be done.”

Analysts agree there is a benefit to AMD’s plans for integrating graphics,
rather than have them on a separate board.

“It’s inevitable, there’s no question of the value, particularly on the
desktop and mobile side,” said Mike Feibus, a semiconductor analyst who
heads TechKnowledge Strategies. “I have no doubt Intel will go down the same
path, it’s just a question of timing.”

Intel  confirmed its plans to do just that.

“We haven’t given a timeframe yet, but we’ve stated our intention to
integrate graphics, we have that capability,” said George Alfs, a spokesman
for the chip giant. “Intel is the number one provider of graphics solutions
in the market and we know graphics.”

Analyst Jon Peddie of Jon Peddie Research, said AMD has an advantage over
Intel with its integrated memory controller. “Adding graphics isn’t going to
be trivial, but it’ll be easier for AMD than Intel,” said Peddie.

“Intel has to get rid of its frontside bus before it can think about
integrating graphics, so we don’t think they’ll even announce anything like
what AMD is doing until 2008. We think AMD has a two-year lead on this kind
of configuration.”

Ironically, while Fusion is about integration, AMD has been touting an
initiative it calls Torrenza which is aimed at opening up its processor to
third-party developers. But Seyer said Torrenza targets a different problem.

“We want to give the brand back to the OEMs [computer makers] and
Torrenza lets them do that,” said Seyer. Torrenza solutions will include
special-purpose chips designed for such things as improved network and
multimedia processing and even Java.

Seyer said AMD plans to push for fast adoption of Fusion in desktop,
mobile and servers. “We think if you integrate the CPU and GPU it solves a
lot of problems,” said Seyer.

Microsoft endorsed the strategy in a statement released today.

“By driving innovation and integration in processing, especially in
graphics, the new AMD has the potential to empower breakthrough computing
experiences for users of Windows Vista, said Jim Allchin, Co-President of
Microsoft’s Platforms & Services Division. “We are excited by the potential
benefits that this union can bring to enhance the Windows Vista experience.”

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