From DailyTech: At its fifth annual Open Compute Summit in San Jose, Calif., the world's second-largest PC and server processor-maker, Advanced Micro Devices Inc. (AMD), has announced the start of a crucial transition. It announced the sampling of the Opteron A1100 Series processor and an accompanying development kit.
These are no ordinary AMD chips. They are AMD's first chips to pack ARM Holdings Plc's (LON:ARM) processor architecture, an architecture that has dominated the mobile space.
This is a soft launch. AMD will be making actual Seattle samples (the codename for the A1100 server chips) available "in the next few weeks" in March. Actual commercial availability will arrive sometime in H2 2014, according to AMD.
For AMD this is a critical release in its bid to return to profitability. AMD has set some incredibly ambitious goals for itself, announcing its intent to become not just a leader, but "the leader in ARM CPUs" and "the leader in ARM servers". AMD evens sets a hard target for itself -- 25 percent of total server chips sales -- more than five times its current market share.
AMD has perpetually playing underdog to Intel Corp. (INTC). With its challenger status has come leadership struggles, layoffs, and turbulent finances.
AMD has tried multiple tactics to give itself competitive and cost advantages. In July 2006, it acquired graphics card maker ATI proving to be ultimately one of the best moves AMD has made in recent years, given its sustaining profits over the last few years. Then in Oct. 2008 it announced the spinoff of its money-losing fab business, which became GlobalFoundries. And most recently it looked to strengthen its position in the server market with the purchase of micro-server maker SeaMicro for $334M USD.
But for all those attempts it still posted a loss in 2013, small as it might be. More troublingly, AMD's market share deficit has grown, not shrunk. In 2007 -- in AMD's strongest market (servers) -- it held roughly 15 percent of the market. By 2012 it had less than a third of that total, with 4.4 percent of the market according to market research firm Trefis.
With the advent of the mass mobile market, AMD sees perhaps its best chance to finally escape Intel's shadow and try to return to steady profitability. Critically, the mobile industry operates on a fundamentally different processor design model, one that spreads the costs and development.
The model begins with ARM Holdings Plc (LON:ARM) which designs the basic core. Then comes the integrators like Qualcomm Inc. (QCOM) and NVIDIA Corp. (NVDA) who add on coprocessors (media, security, I/O, etc.). Lastly graphics firms, such as Imagination Technologies Group Plc (LON:IMG) (or NVIDIA) add on value via their special graphics processors.
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