Two challenges immediately present themselves. First off, the design
cycles in the embedded space are longer than in the traditional
PC/consumer area and ASPs can be lower. Secondly, AMD's third targeted embedded market, gaming, left some scratching their heads.
"They already have Nintendo and rumors about them getting next Xbox
720 and PS4," said Patrick Moorehead, president and principal
analyst with Insights & Strategy (Austin, Texas). "They already
have graphics for Wii and Xbox 360. Maybe by gaming, they mean Las
Vegas gaming where AMD does a lot of business."
Of AMD's three turn-around keys, Moorehead sees embedded as the one with the least potential long-term impact, but also the fastest potential for a short-term revenue boost. The architectural push toward heteregenous
computing and the SeaMicro acquisition loom as bigger impacts for
the company, he argues.
AMD earlier this year launched, along with companies such as
MediaTek and ARM, the Heterogenous System Architecture
which aims to make parallel computing programming easier
and enable merged graphics, x86 and other cores in SoCs.
"They've agreed on a new memory architecture which uses the GPU
(graphics processing unit) and CPU as equal citizens in getting
access to memory," Moorehead said. "Inside of the SoC it would make
the CPU a lot less important where Intel has a dramatic lead over
AMD and the ARM guys."
AMD has a leg up on graphics processing technology (through its 2006
acquisition of ATI), where Intel needs to "pay the Nvidia tax every
year," Moorehead said.
The third key to the company's future is the technology that came
over with the SeaMicro
acquisition in February.
In September, the AMD
group announced Intel- and AMD-based systems extending
the link to up to 1,408 hard drives or five petabytes of external
storage using AMD's Freedom Fabric interconnect technology. SeaMicro
has gained some traction with large enterprise data centers
interested in the significant power savings the systems offer.
"I see Sea as a disruptive play in exa-scale data
centers," Moorehead said. "As traditional data centers move to these
football-field sized data centers, the industry moves to specialized servers from homogenous servers.
That's the Sea play."
AMD against the world
Strategy on a conference call is one thing; making it happen
another, as AMD executives acknowledge. "We do have to build our
execution credibility," Su said.
The company has lost some key executives in recent weeks, but
inside, there remains the OK Corral mentality that's marked the AMD
culture since the days of Jerry Sanders.
"There is still optimism at AMD, even through there are challenges,"
said Moorehead, himself an AMD alumnus. "People buy into those big
bets and kind of see where AMD is and where it could be. There are
people who still get excited about that stuff. You have to have a
different kind of personality to work at AMD."