When Apple changed over from Power processors to x86 architecture, I had wondered why the company did not go with AMD. I had thought that from a monetary stand, it would make terrific sense, because AMD processors were always less expensive, and at that time, they were also more powerful.
The only reason it would not have made for a great deal is if Apple had thought that AMD could not keep up under its debt load after the acquisition of ATi. When the deal did not happen, I had personally thought that must be the problem, as Mr. Jobs is as fiscally conservative as anyone in the computer business.
This morning, Larry Dignan, from ZDNet is reporting that Apple and AMD are talking processors and graphics cards, which would be a sweet deal for AMD, and a win for Apple, as it would also have a great shot at the best graphics power available right now.
It does not mention the irksome way that nVidia has not kept pace, and I’m certain that bothers Mr. Jobs as well.
Apple is reportedly talking with Advanced Micro Devices about using the No. 2 chipmaker’s processors. Simply put, an Apple win would be huge for AMD since its profit margins just can’t keep up with Intel’s at the moment.
- AMD reps have been seen talking with Apple;
- Apple is working with AMD chips in its labs;
- Apple wants to diversify and isn’t happy about Intel design decisions that have hurt the company’s partnership with Nvidia;
- Apple may be interested in AMD for its graphics ability and the fusion of CPUs and GPUs.
The AppleInsider report is fascinating in that it shows how Apple may be looking for leverage. An Apple-AMD hookup raises some interesting questions. Among them:
- AMD will give Apple lower component pricing?
- Will consumers get that AMD discount baked into pricing?
- How serious is Apple about AMD?
- What would happen to Apple’s Nvidia partnership with an AMD deal?
- Will Apple really have two flavors of MacBooks—AMD or Intel?
- Or will Apple go with AMD completely and make the chipmaker’s quarters for the next few years?
On AMD’s first quarter earnings conference call, Dirk Meyer, CEO of AMD, wasn’t talking much about anything with Apple. There was a passing mention, however. Here’s the exchange:
UBS analyst Uche Orji asked:
Apple announced some refresh of their Mac book product suite with product from Nvidia, where one of the comments they made on the website is a concept of switchable graphics as part of the reasons why they chose it, and it has possible impact on the battery life. How does this compare to what you have, and how do you plan to respond to this type of competitive pressure coming from Nvidia? So if you can just talk about what Apple has done, the announcement they made and how that impacts your product. That would be helpful.
Sure. I think that’s a referenced to what they call Optimus. Switchable graphics capability. At the high level, we’ve had switchable graphics capability in the graphics platform for a couple of years under the banner of power express. My understanding of Optimus is it provides a little bit more of a software-controlled experience and one that we have in our development pipeline as well. The final thing I’ll say is kind of the ultimate high performance graphics experience in a notebook is actually going to be made available in the Fusion context which is one of the reasons that we’re so excited about having Fusion available in the market.
Add it up and AMD could provide the graphics capability Apple is looking for. As AppleInsider noted, AMD traditionally trails Intel on raw performance. However, Ghz is a secondary issue for Apple buyers. An Apple purchase is about design, quality, OS X and ease of use. AMD can get by on the Ghz equation with a mere close enough to Intel if the graphics stars line up. Sean Portnoy asks whether folks would buy an Apple with AMD inside. I’d argue that the processor is a secondary consideration (at best) for buying an Apple.
Analysts were mixed on AMD’s profitable first quarter. Many noted that the AMD quarter was fueled by an inventory build courtesy of design wins at Acer and Lenovo. An Apple design win would be another boon for AMD.
Besides the overall difference in power, I’d say that Apple might have gotten a whiff of upcoming products from AMD in their exchanges, and maybe there is some really good news coming along with the die shrink to 32nm in the second half. Should there not be a game changer in power, the synergy of AMD CPU and AMD graphics should make up a lot of ground over Intel CPUs not being fully complementary to anything else that might be AMD.
More reason to buy an Apple machine if it happens, and, for those that won’t buy, but want OS X goodness, perhaps a simple way to get a great performing AMD Hackintosh.
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