The three reasons why AMD acquired ATI

WE HAD a chance to talk to a nice chap called Mario Rivas who happens to be an Executive Vice President, Computing Products Group at AMD. We had a chance to ask him a few questions and one of my key ones was why the company acquired ATI.

He divided the answer into three key points. The first one was that AMD wanted to acquire a big chunk of the graphics business. AMD really cares about graphics, he says, and not only for games. The chip maker saw the potential in the computational power of a GPGPU graphic chip and the company wants to use it. He pointed out that there is just about space for anyone including Nvidia or anyone else. At least at this point AMD claims not to want to put anyone out of business.

Second point is the consumer business that AMD acquired. This business includes DTV, handhelds and some other multimedia stuff that ATI was doing in a market that has grown up to $2 billion a year. AMD certainly wants a piece of that and ATI was very successful in this market.

The third point is further in the future and it is called Fusion. It is a GPU on CPU integration scheduled for late 2008 if not even later. This is the way to go, he explains, as it will make a more power efficient processor for all of the tasks. It is all about increasing the overall computational speed.

This is why AMD wanted ATI or Nvidia and now it all gets a bit clearer than last summer when we broke the story. µ