Advanced Micro Devices (AMD)

Sunnyvale, California-based Advanced Micro Devices, Inc., 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  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-compatible 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”  from Intel chips, AMD eventually used a “clean room” process to independently create functionally equivalent code. However, 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  agreement allowing AMD to use Intel code and providing 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  was widely viewed as a superior implementation of the microcode in the Intel Pentium—and it was “pin compatible,” 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 processing capacity.In the early 2000s AMD seized the opportunity to beat Intel to market with chips that could double the data bandwidth from 32 bits to 64 bits. The new specification standard, called AMD64, was adopted for upcoming operating systems by Microsoft, Sun Microsystems, and the developers of Linux and UNIX kernels. AMD has also matched Intel in the latest generation of dual-core chips that essentially provide two processors on one chip.

 Meanwhile, AMD strengthened its position in the high-end server market 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 collaborating 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.