Nobody wants to pay for something that doesn't work, and the same holds true for big corporations, like AMD. No longer willing to accept non-working parts, AMD hammered out a new deal with GlobalFoundries in which it will only pay for chips that that work as advertised. Prior to this revised agreement, AMD was paying for all chips produced at cost plus a markup for GlobalFoundries, and it didn't matter whether the chips worked or not.
Globalfoundries has one simple goal -- to become the biggest contract manufacturer of computer chips on this or any other planet. Working towards that goal, the company will increase spending from $2.7 billion in 2010 to $5.4 billion this year, the company's CFO, Robert Krakauer, said in an interview.
The increased spending will be used to upgrade a plant in Dresden, Germany, as well as putting up two new plants, one in New York and one in Abu Dhabi.
Not many chip makers can spend the kind of money Globalfoundries has allocated, the Taiwan Semiconductor Manufacturing Company (TSMC) being one of the ones which can. TSMC spent $5.9 billion in 2010 and expects to spend even more in 2011. Intel ponied up $5.2 billion last year, and Samsung trumped them all by spending around $10 billion.
Perennially beleaguered chip maker AMD announced Monday that Dirk Meyer is no longer the company’s CEO. Until it finds a permanent replacement, Chief Financial Officer Thomas Seifert will serve as the firm’s acting CEO. The abruptness of Meyer’s resignation has left a lot of room for speculation. AMD’s perfunctorily terse explanation hasn’t helped either. Meyer’s resignation was the result of a mutual agreement between the board and the former CEO was all that the company was willing to say.
"Dirk became CEO during difficult times. He successfully stabilized AMD while simultaneously concluding strategic initiatives including the launch of GlobalFoundries, the successful settlement of our litigation with Intel and delivering Fusion APUs to the market,” said AMD chairman Bruce Claflin about the former CEO’s accomplishments.
"However, the Board believes we have the opportunity to create increased shareholder value over time. This will require the company to have significant growth, establish market leadership and generate superior financial returns. We believe a change in leadership at this time will accelerate the company's ability to accomplish these objectives."
Speculation is rife that Meyer’s failure to gauge the growing importance of the mobile market could have been a major reason for his ouster. Under Meyer, AMD adamantly refused to shed its inexplicable apathy towards increasingly important device segments like netbooks, smartphones and, most recently, tablets.
During this week's Global Technology Conference, GlobalFoundries unveiled the world's first 28nm ARM Cortex-A9 processor platform with High-K Metal Gate (HKMG) technology.
"This is a significant milestone on the road to high-volume 28nm manufacturing and technology leadership for next-generation products ranging from smart mobile devices to high-performance wired applications," said Mojy Chian, senior vice president of design enablement at GlobalFoundries. "By working closely with ARM in the early stages of technology qualification, we will enable our customers to rapidly bring their ARM Cortex-A9 designs with ARM physical IP to production by setting a new standard for performance and power-efficiency."
GlobalFoundries says its new production capabilities will "enable smooth ramp-up and faster time to market" for its customers, and will enable a 40 percent increase in computer performance, a 30 percent power savings, and a 100 percent increase in standby battery life compared to 40nm technology.
Looking ahead, GlobalFoundries has set a goal to deliver 20nm technology to customers by 2013.
British chip designer ARM, which currently enjoys an almost unchallenged run in the mobile and embedded device markets, has announced a new deal with TSMC (Taiwan Semiconductor Manufacturing Company). Termed the “broadest agreement” between the two companies that happen to go back a long way, it will yield nimbler and more power-efficient chips.
"I am pleased that ARM and TSMC will be working together to enable ARM processor based SoCs leveraging both companies' advanced technologies," said Mike Inglis, executive vice president and general manager, ARM Processor Division.
GlobalFoundries, the chip manufacturing firm that began as a spin-off of AMD, announced plans to expand its semiconductor manufacturing operations with a bunch of new projects.
First up is a new wafer manufacturing facility at Fab 1 in Dresden, already the largest wafer fab in Europe. After the expansion, Fab 1's total output will ramp up to 80,000 wafers per month and add additional 45nm, 40nm, and 28nm capacity, GlobalFoundries says.
In addition, GlobablFoundries will expand the cleanroom shell currently under construction at Fab 8 in New York. Once finished, the company will have the option of increasing capacity of 28nm, 22nm, and 20nm parts and bring the overall site output up to 60,000 wafers per month.
"Our 300mm fabs have been consistently ranked among the most advanced and efficient in the industry," said Chia Song Hwee, chief operating officer, GLOBALFOUNDRIES. "Now we are taking our heritage of lean foundry manufacturing and world-class fab performance and making it available on a broader scale to meet the demands of the world’s leading chip design companies. With this aggressive capacity build-out plan, we are well positioned to provide new and existing customers with the fastest option to get advanced products to market in the volumes they need to ensure success."
GlobalFoundries went on to say that the big focus for the Fab 1 campus will be on adding new capacity to support additional growth. Put into perspective for sports fans, GlobalFoundries says the fabrication equipment would be able to cover an area equivalent to approximately eight soccer fields. Game on.
A newly announced partnership between ARM and GlobalFoundries could mean the next generation of mobile devices will be faster than anyone expected. The project will focus on the ARM Cortex-A9 chip. The current Cortex-A8 powers the iPhone 3GS and the Palm Pre. The new chip will be based on a 28nm process.
According to GlobalFoundries, the 28nm parts will take advantage of the manufacturer’s High-K Metal Gate semiconductor. The HKMG technology is known as “Gate First”, meaning that it should allow high performance with minimal leakage.
ARM CEO, Warren East, said of the collaboration, “This announcement reflects our business value and strategy of providing best in class processor implementation by marrying our own processor and physical IP with world class manufacturing semiconductor technology.” So get ready, the next round of ARM chips could blow your socks off.
AMD’s manufacturing spin-off, Globalfoundries, has started to obtain bulk 32nm process technology so that they can begin taking orders by Q4 2009/Q1 2010. Should these plans come full circle, it would allow Gobalfoundries, and AMD, to get a solid foothold in the 32nm market, making them competitive with United Microelectronics and Taiwan Semiconductor Manufacturing (who are both working on 32nm processes of their own).
“Globalfoundries is entering the foundry market at the right time and with the right business model to change the landscape of the industry. More importantly, we’re entering the industry with the right mindset and resources. Our investments in leading edge technology and in supporting infrastructure will ensure the success of our customers,” said Jim Kupec, Vice President of Sales and Marketing.
Back in October 2008, Intel expressed concerns over AMD's announcement it would split into separate design and manufacturing firms, saying such a move would might run afoul of the Patent Cross License Agreement the two signed in 2001. The Agreement, which expires in 2010, has restrictions related to the transfer of licenses and patents, and according to Intel, "AMD cannot unilaterally extend Intel's licensing rights to a third party without the Intel's consent."
Now that the spin-off is complete, AMD said today that Intel plans to pull its 2001 agreement within the next 60 days, that is unless AMD addresses concerns surrounding AMD's joint-chip foundry, Globalfoundries. AMD meanwhile says it "strongly believes that the company has not breached the terms of the cross-license and Intel has no right to terminate the company's rights and licenses under the cross license."
AMD said the parties are trying to resolve the issue through mediation, however both AMD and Intel contend that the other has breached the 2001 agreement.