Sunnyvale, California-based Advanced Micro Devices, Inc.,
(NYSE symbol AMD) is a major competitor in the market
for integrated circuits, particularly the processors that are
at the heart of today’s desktop and laptop computers .The company was founded in 1969 by a
group of executives who had left Fairchild Semiconductor.
In 1975 the company began to produce both RAM (mem-
ory) chips and a clone of the Intel 8080 microprocessor.
When IBM adopted the Intel 8080 for its first personal
computer in 1982,
it required that there be a second source for the chip. Intel
therefore signed an agreement with AMD to allow the latter
to manufacture the Intel 9806 and 8088 processors. AMD
also produced the 80286, the second generation of PC-com-
patible processors, but when Intel developed the 80386 it
canceled the agreement with AMD.
A lengthy legal dispute ensued, with the California
Supreme Court finally siding with AMD in 1991. However,
as disputes continued over the use by AMD of “microcode”
(internal programming) from Intel chips, AMD eventually
used a “clean room” process to independently create func-
tionally equivalent code . How-
ever, the speed with which new generations of chips was
being produced rendered this approach impracticable by
the mid-1980s, and Intel and AMD concluded a (largely
secret) agreement allowing AMD to use Intel code and pro-
viding for cross-licensing of patents.
In the early and mid-1990s AMD had trouble keeping up
with Intel’s new Pentium line, but the AMD K6 (introduced
in 1997) was widely viewed as a superior implementation of
the microcode in the Intel Pentium—and it was “pin com-
patible,” making it easy for manufacturers to include it on
their motherboards.
Today AMD remains second in market share to Intel.
AMD’s Athlon, Opteron, Turion, and Sempron processors
are comparable to corresponding Intel Pentium processors,
and the two companies compete fiercely as each introduces
new architectural features to provide greater speed or pro-
cessing capacity.
In the early 2000s AMD seized the opportunity to beat
Intel to market with chips that could double the data band-
width from 32 bits to 64 bits. The new specification stan-
dard, called AMD64, was adopted for upcoming operating
systems by Microsoft, Sun Microsystems, and the develop-
ers of Linux and UNIX kernels. AMD has also matched
Intel in the latest generation of dual-core chips that essen-
tially provide two processors on one chip. Meanwhile,
AMD strengthened its position in the high-end server mar-
ket when, in May 2006, Dell Computer announced that it
would market servers containing AMD Opteron processors.
In 2006 AMD also moved into the graphics-processing field
by merging with ATI, a leading maker of video cards, at
a cost of $5.4 billion. Meanwhile AMD also continues to
be a leading maker of flash memory, closely collaborat-
ing with Japan’s Fujitsu Corporation. In
2008 AMD continued its aggressive pursuit of market share,
announcing a variety of products, including a quad-core
Opteron chip that it expects to catch up to if not surpass
similar chips from Intel.
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