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AMD could not decide between ATI and Nvidia

by on23 February 2012

Details finally emerge

While it is ancient history now, it seems that the story about the controversial buying of ATI by AMD was not an easy process.

Forbes has found a deep throat who has left AMD who has told it that AMD approached graphics processor designer Nvidia about an acquisition before snapping up Nvidia rival ATI in 2006. AMD leaders believed that shrinking transistors would create an opportunity to add new capabilities to the processors AMD and rival Intel designed for PCs and servers.

AMD Chief Executive Hector Ruiz decided to bet that AMD could get ahead of rival Intel by grabbing a piece of the market for GPUs. Fusing CPUs and GPUs would let AMD hit the PC market with something Intel wasn’t ready to offer. Initially AMD thought that Nvidia was the best bet but the deal was killed off because Nvidia Chief Executive Jen-Hsun Huang insisted on being chief executive of the combined company.

Ruiz decided it was better to buy Nvidia rival ATI in July of 2006 for $5.4 billion. Nvidia replied by unleashing several strong products, gobbling up market share. AMD has fought its way back, with a strong lineup of graphics processors, Nvidia pushed into mobile processors. Nvidia has a market capitalization of $9.7 billion. AMD is worth just $5.2 billion. Maybe it would have been a better deal after all, but AMD's troubles have a lot more to do with CPUs than GPUs anyway.

More here.

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