Chip of a different block

TECHNOLOGY: AMD is fast gaining ground in the processor market, not that Intel intends to let that pass.

2006 was probably one of the better years for Advanced Micro Devices (AMD). Despite an onslaught of price cuts and new products from the competition, AMD gained market share against Intel in the second quarter of 2006.

With a market share of 25 per cent today, AMD would love to up its stake to 30 per cent in 2007-08. And this is how. "Through a lot of product innovation. Users who like to see the greatest return on their quad-core investment are users of multithreaded applications like customer relationship management, enterprise resource planning, e-commerce and virtualisation," says Deepanshu Sharma, general manager (marketing), AMD (India).

The company intends to get aggressive in the notebook space in 2007. In the desktop segment, AMD has alliances with HCL, HP, LG, Acer and Sahara. AMD has also partnered with Sun, HP, IBM, Wipro along with HCL and Sahara in the server segment.

AMD has already launched its dual core 64-bit laptop chip and now aspires to get a better slice of the enterprise and cater to the high-end consumer segment.

According to Sharma, AMD is gaining entry in the enterprise through its Opteron-based servers. Industry insiders are abuzz with speculation that AMD is shining in the server market.

With its Opteron X2 DP processors growing at 45 per cent, AMD has gained a healthy 33 per cent of market revenue. Intel's market share has declined by 5 per cent.

Third quarter revenues of AMD indicate that it is $1.328 billion strong and the company is looking to shrug off the tag of "being cheaper" than its competition.

The marketing workforce, mentions Sharma, is currently redesigning its campaigns that would be "more experiential" in nature.

"A better channel partnership and a lot of emphasis on why AMD over others, is going to be our endeavour in the year to come," he says.

The competition, meanwhile, is far from inactive. Intel, reportedly, is back in action with the launch of dual-core chips including the Core 2 Duo for desktops and Xeon 5100 'Woodcrest' for servers.

On November 14, Intel reached the market first with quad-core chips, with Core 2 Extreme QX6700 for gamers and Xeon 5300 for servers. AMD is expected to follow in 2007. Quad cores allow the microprocessor package to perform up to four functions simultaneously. Market watchers say that Intel's move could be a part of its effort to push back rival AMD.

In a release, Jason Waxman, director of Xeon server platforms marketing for Intel remarked, "The OEMs wanted these new processors. They said if there is anything you could do so we could get the products early, it'd help."

Waxman declined to be specific about which Intel fabrication facilities will be used to make the products, but added that Intel has the capacity to gear up production ahead of schedule.

The 5335 (2-GHz processor) will be installed in servers and workstations from companies such as Dell, HP, Silicon Graphics and IBM. The list price is $690 when purchased in quantities of 1,000 or more.

According to Mercury Research, AMD's market share has increased slightly, despite PC processors' shipments decreasing by 7 per cent quarter-over-quarter. AMD's unit shipment increased to 22 per cent and the revenue share increased to 18 per cent "" and yes, it was at the expense of Intel.