However will the return of these people help AMD? While is can be argued that AMD is desperate need of good engineers and leaders that still does not mean that the direction of the company is the right one and will produce results. AMD is finishing up their third straight quartet with a loss. While some will blame this on slump PC sales that is not the only culprit. Looking at the offerings in most box stores (Best Buy etc) AMD represents a fraction of the systems available and a close study shows little interest in their systems. We lurked around the counters at one Best Buy for about four hours and noted that people did not seem impressed with the AMD systems offered. In many cases they passed them up for more expensive solutions from Intel.
This brings us back to the original vision from Rory Reed. He wanted to move AMD into the mobile market back in 2011 shortly after he took over the top job at AMD. His idea was to pull AMD out of what he felt was a pointless competition with Intel and focus on providing solutions for the mobile environment that was the center of consumer interest. Reed most likely felt that AMD was in a position to grab some of the market from ARM if they could get their APU solutions read quickly enough. Unfortunately while AMD’s APUs are more than a match for any of the ARM based solutions they were not (and are still not) great for general x86 workloads and fall far behind if you need them for any sort of professional work. This put them in a very awkward place in the market.
Think about it this way; an AMD APU can produce some amazing graphics meaning you can push 1920x1080 with one and not break a sweat which is great of systems that are very media or gaming based. Now when you ask them to do non-graphics dependent work their poor memory performance and lack of real processing power puts them only slightly ahead of their ARM competitors. So when the market is presented with this it becomes a single vertical product and not of much use outside that range. As we have shown people view their tablets as companion deices, but their laptops and notebooks as workhorse systems in the same way they did their desktops a short time ago. This means that consumers are looking for the same things they wanted in a desktop and as more enthusiasts move into the mobile market we are seeing an “I want it all” attitude. If you look at the products that are selling right now they are typically capable of good graphics and good processing power. This leaves AMD’s APUs out in the cold. They simply cannot compete with the Intel + dedicated GPU solutions which are becoming more and more popular. This means that AMD is now behind the curve in both the desktop and laptop/notebook market.
When it comes to the tablet/convertible market AMD is behind because they did not have anything to offer manufacturers as Microsoft built up to the Windows 8 launch. They (AMD) were sponsoring a few Android on x86 projects, but none of those are at a point where they are commercially viable and AMD does not have the money to make them so at this time. The upshot of this is that the majority if not all of the available x86 based tablets will have Intel’s Atom or Ivy Bridge CPUs in them. AMD is working hard to change this, but we do not expect to see them really gain any ground in this market until 2014 or later. This leaves AMD with only one market where they have room to maneuver thanks to their ATi heritage; game consoles. As has been reported by many news outlets AMD will be the processor of choice for both Sony and Microsoft’s new gaming consoles.
These new devices are supposed to bring new levels of graphical detail along with better AI, in-game physics and more. AMD’s x86 APUs could be a very good fit for these as they do have the GPU power for good graphics as well as a little extra headroom for OpenCL accelerated physics and AI. For Microsoft is also means that they can create better integration between the Xbox and the PC/RT tablets and systems. We imagine that Sony is probably thinking along the same lines pushed by the game development companies that can now potentially develop for a single platform instead of having to develop for the console and port the code to the PC. The problem is that the console market is not enough to keep AMD going; they have to re-invent their desktop and mobile CPUs to compete with Intel and even ARM. The decision to stop trying to compete with Intel was a bad one; you have to compete with Intel or you end up losing simply because you do not have an offering.
This means that AMD’s graphical focus is the wrong direction for them. They cannot continue to think that consumers are only interested in rich visuals leaving the computing to someone else’s CPUs. The cloud is still a scary place for most consumers outside of email and short term storage. Even the move to online gaming is not going to help here and may actually hurt AMD and their APUs in the long run.
Overall the move of Raja Koduri from Apple to AMD will be a minor impact to both companies. Apple has lost a good mind and AMD has gained one, but Koduri does not help AMD where they need it most and Apple is not what you would call a graphically interested company. They are more than happy to use Intel’s GMA or pull in either AMD or nVidia when they need more power behind their systems.
We do hope that AMD can turn things around, but we have a feeling that until they can put more money and effort into improving their CPUs we will not see a change. Rory Reed cannot continue to rely on good enough computing and bank on the cloud. Do this is a road that will keep AMD in the red and put them even further behind than they already are.
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