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Why Apple Should Acquire AMD
Posted by
CmdrTaco
on Wed May 02, 2007 09:23 AM
from the what-else-do-you-do-with-mad-ipod-money dept.
from the what-else-do-you-do-with-mad-ipod-money dept.
slashdotLIKES writes "CoolTechZone.com columnist Gundeep Hora has a new column up that discusses why Apple should acquire AMD and how both companies would be a good fit for each other. From the article, "After private equity groups, let's look at a more strategic acquisition. For that, Apple is the best bet. Yes, I know it sounds way too radical to be taken seriously. However, Apple could drop Intel altogether and adopt AMD for its Macintosh PCs. Sure, the transition is going to take sometime, and it would probably make Apple announce a brand new line of PCs. However, it will be well worth it. We know Steve Jobs is ruthless when it comes to making interesting deals with powerful companies. This makes AMD a perfect match. Obviously Intel isn't going to be too delighted, but other companies don't bother Jobs. We all know he's the type of executive who crafts deals on his own terms. If Intel wants to be associated with Apple, then they won't really have much of a choice."
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I doubt it would happen (Score:5, Informative)
Re:I doubt it would happen (Score:5, Insightful)
They just switched to Intel chips less than two years ago! There are still a few apps here and there that are still dependent on Rosetta. And Apple is supposed to just pick up a new microchip like a teenager picks up a new favorite song every other week? Intel's not the only one that would be pissed (and rightly so!), but we customers, as well. I don't want to deal with another switch, and neither does anyone else. Plus, I don't think Apple wants to throw its years of work away after only two very successful years.
No shit. In fact, they're not quite done with the transition to Intel just yet. Apple was lucky in that it had the foresight--or fortune--to maintain a secret Intel-native OS X build for years. I highly doubt they have another one for AMD. So, however long it's taken for the Intel switch, it's going to take much longer for AMD. That won't go over well with anyone involved.
I think our time is better spent arguing whether Apple should buy out Nintendo. Or vice versa. Whichever one incites the more amusing flamewar.
Parent
Re:I doubt it would happen (Score:5, Insightful)
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Re:I doubt it would happen (Score:4, Interesting)
For nearly a decade Steve and the CEO of Intel have had lunch once a year. That shows how long the deal was "in the works".
-nB
Parent
Re:I doubt it would happen (Score:5, Insightful)
The switch from PPC to intel was a far greater feat than going from Intel to AMD would be. In fact, I doubt there'd be a single software issue... apart from the lack of EFI (which I'm sure Apple could wrestle away from Intel at some outrageous price).
The problem is, AMD doesn't make anything Apple really wants. Apple needs good laptop processors, of which Intel make the best. Intel's doing better in the quad-core arena which is obviously where Apple wants to go.
This isn't just about buying AMD, it's also about switching processor suppliers--to processors which are currently not as good as Intel. They may be cheaper, but most macs require fast and cool processors due to their form-factor, or require the fastest available processors. AMD dominates in neither category.
I'm a huge AMD fan, my last PC (before I dumped it and my G5 to get a Mac Pro) was an AMD as were all my PCs before that. I fully admit, however, that currently Intel is winning the war.
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Re:I doubt it would happen (Score:5, Informative)
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Re:I doubt it would happen (Score:5, Insightful)
And before that they switched to the G4/5, before that PowerPC, before that 6800.
This proposal is one of the dumbest ideas that I've heard. Apple is an integrator. Their software integrates the hardware, so they make that. The hardware is disposable. Buying AMD would severely limit Apple to innovate in the future.
No electronics integrating company that I know of ties themselves to such a specific piece of hardware. None.
This is absolutely silly.
Parent
Answer without a question (Score:5, Insightful)
Why?
AMD and Intel exist to keep each other at bay. Consumers are the winner at the end of the day because of this relationship. Meddling with that can't be good, my gut says.
Re:Answer without a question (Score:4, Insightful)
AMD and Intel exist to keep each other at bay.
And here I thought that they exist to make their shareholders money. Silly me.
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Re:Answer without a question (Score:5, Insightful)
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here's why (Score:5, Funny)
Re:here's why (Score:4, Insightful)
How many fanboys are there with no PC? How many fanboys have more than one PC?
I fail to see the same ratio of fanboys/products that you see..
Parent
why bother? (Score:5, Insightful)
At this point, I'd call AMD interesting, but I don't know about powerful.
Apple has made some interesting deals in the past, but the whole point of the Intel switch was because Intel is the clear market leader for processors, and there's nothing out there that makes me think this is going to stop any time soon. Apple doesn't need to have something else to differentiate themselves from the standard PC market like this.
Totally Different Market (Score:5, Insightful)
Also, if you look at Apple's key to success in recent years, it's their ability to design products that are "sexy". I don't see how they could leverage that while designing processors.
that would be a milestone (Score:5, Insightful)
And the core competence of the combined company would be...? This would make the AOL-Time Warner deal look sensible in comparison.
This is a crazy and silly idea (Score:5, Insightful)
AMD chips run hotter, slower, and require more power. Their current designs are reaching their limits, and no feasible new ones are on the horizon. Intel, meanwhile, already in the lead with the Core 2 Duo, is going to jump still further forward with Penryn.
Why would Apple move to hotter, less efficient chips? Why would Apple partner with a massively unprofitable company? Why would Apple change what they're doing at all at this point?
I love AMD, and I've been loyal to them since the first K7s came off the line, but Intel has far more potential in the near future with better R&D, better chips, and surprisingly low prices.
Re:This is a crazy and silly idea (Score:5, Insightful)
Parent
Then Apple would have to use slower AMD chips! (Score:5, Insightful)
Re:Then Apple would have to use slower AMD chips! (Score:5, Funny)
--
--- Often in error; never in doubt!
Parent
One word answer: no. (Score:5, Insightful)
In any case, the future of (personal) computing is in the laptop/mobile segment. Apple knows this, and this is why they certainly won't buy AMD.
Utterly horrible match (Score:5, Insightful)
For AMD it would be a disaster, because AMD would suddenly be in a position where it competed directly with its own customers. It would in one stroke be one of the largest producers of PC's, which would be unlikely to sit well with the rest of the industry.
[ The later reason also explain why a an Apple / Disney merger has become less likely, as Apple has become a big time content distributer. ]
Translation of TFA (Score:5, Funny)
Apple needs to be nimble not its own chip supplier (Score:5, Insightful)
Why on earth would Apple want to acquire a chip and graphics card manufacturer? Didn't Apple specifically go with Intel over AMD due to Intel's stronger road map? I don't doubt that it could have been about price too, but that leads me to my second point.
Despite Apple's position as a hardware company, a hardware manufacturer they are not. Apple designs their products, sure, but production is outsourced to others. Apple stands to benefit from not being in the chip manufacturing business. As long as Intel and AMD exist to compete against each other, Apple can play off their competition to get the best pricing. The same could be said of leading video card manufacturers NVidia, ATi/AMD, and Intel.
One would presume that should Apple acquire AMD, their Mac products would become entirely AMD/ATi based. So how does Apple benefit? Becoming their own chip supplier would certainly increase R&D, manufacturing and supply chain costs without yielding a single advantage. Apple needs to remain nimble and flexible. Right now they could drop Intel for AMD in a blink should AMD surpass Intel in price/performance and then jump right back if and when Intel takes the lead back. Should Apple acquire AMD and have AMD chips fall well behind Intel's, Apple would be sitting on a big loss with less than optimal chips in Macs to boot.
Honestly, the author of TFA doesn't know what he's talking about.
Riiight. (Score:4, Insightful)
Seriously, why do people always think Apple should be buying out other companies "just because?"
"Expand or die" is what kills companies... (Score:5, Insightful)
It used to be that you could keep a company going simply by consistenly producing good products for a good price and a reasonable profit. As long as the products and the price both remained good, people would buy the products and the profits would keep coming in. Obviously the products would have to be refined over time as the needs of the customer base changed, but this fundamental approach is sound.
For some reason, that's not good enough for Wall Street anymore. And so, the notion that companies must grow and expand to be "successful" has been pounded into everyone's head until nobody bothers to question it anymore. And the end result is idiotic articles like this one.
Apple produces a good product for a good price and a reasonable profit. They have been doing this for the last 25 years, ever since their inception. They have stumbled from time to time, yes, but they have survived all this time because when they were in trouble they dropped back to this simple, but time-tested, approach.
Despite this, there have been constant predictions of Apple's demise. After all, how could a company be "successful" if it didn't continuously expand, right?
One needn't expand in order to succeed. One need only provide something that others need or want at a price they can afford and at a price that brings in enough profit to get the job done. Hewlett-Packard appeared to have understood this, back when Bill Hewlett and David Packard were running things. Apple appears to understand this now, under the tutelage of Steve Jobs.
The "expand or die" mantra comes as a result of most stocks today being valued based on how much their share price will rise in the future, because for some reason paying dividends (which any steady-state business would do if it were sane, and which I believe most companies used to do) has become passe. That's not good for the company (and thus its employees and customers) in the long run because expansion is unsustainable and almost always leads to a loss of focus.