Advanced Micro Devices Inc (AMD)

[Jerry R]

sgolds -

That is what makes the IBM relationship so intriguing - if you combine the great design capabilities of AMD with the manufacturing might of IBM, then you have a combination that can alter the market share dynamics greatly.

Why do you believe in IBM's manufacturing capabilities? When in their history have the they ever proven that they can fabricate millions of complex chips per year with high, stable yields? Certainly not PowerPC; they split the volume with Motorola to supply Apple, who continue to hold less than 5% of the overall PC market.

AMD has much more experience in high volume manufacturing than IBM given their market share in x86 processors. IBM's semiconductor strength is in its technology development, not high volume manufacturing. Is AMD going to teach IBM how to fabricate in huge numbers? If IBM wants to become a high volume producer of CPUs, shouldn't they be paying AMD for the technology and processes to accomplish this (and not the other way around)?

I don't think it is wise to believe that IBM will become a manufacturing powerhouse and allow AMD to second source K8 processors to capture market share. There simply isn't a historical context to demonstrate this possibility. Just my opinion.