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Rumor: Microsoft is interested in buying AMD

What do you think of this proposed buyout?

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statham

statham

Member
In a bid to revive its chip design operations, Microsoft Corp. may acquire Advanced Micro Devices, according to a source familiar with the matter. The software giant approached AMD several months ago, the source indicated. The result of the talks is unclear.
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The details about negotiations are unclear, just like Microsoft’s exact proposal to AMD. However, since Microsoft has $95.3 billion in cash, whereas AMD’s market capitalization right now is $1.81 billion, the software giant may buy AMD relatively easily. In fact, current value of AMD is three times lower than the company paid for ATI Technologies in 2006.

Analysts estimate that Microsoft pays around $100 for every Xbox One system-on-chip to AMD. Life-to-date sales of Xbox One are around are around 12.6 million units, which means that Microsoft has already paid AMD around $1.26 billion for Xbox One chips. The acquisition of AMD could save it around a billion per year on Xbox One chips alone. It the company develops appropriate chips for smartphones and tablets, Microsoft’s savings could be even higher.
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The battle for video game console space is very strong. If Microsoft bought AMD, then Sony would be faced with a bad set of choices: put money in Microsoft’s pocket every time it sells a PlayStation, or try to create an entirely new platform by using technologies from Intel, Nvidia, ARM or Imagination Technologies.

Since game consoles is an important business for Microsoft, the company naturally wants to make sure that its technology provider does not go bankrupt or is acquired by a competitor. For example, if Samsung takes over AMD and builds-in its APUs into its TVs, it will automatically become a major player in the market of video games.
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http://www.kitguru.net/components/a...erested-to-buy-advanced-micro-devices-source/
 
K

Kralamoonard

Member
statham said:
http://www.kitguru.net/components/a...erested-to-buy-advanced-micro-devices-source/
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If this is true it could be a legitimate game changer IMO, simply because of the first paragraph in the second quote:

"The battle for video game console space is very strong. If Microsoft bought AMD, then Sony would be faced with a bad set of choices: put money in Microsoft’s pocket every time it sells a PlayStation, or try to create an entirely new platform by using technologies from Intel, Nvidia, ARM or Imagination Technologies....."
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S

SalvaPot

Member
Analysts estimate that Microsoft pays around $100 for every Xbox One system-on-chip to AMD
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Daaaamn, that is 1/4 of every console and I am sure AMD makes a nice profit out of every chip.

But I was under the impression that Microsoft does not values its Xbox brand as much as its PC line, so I want to think buying AMD has more benefits to their PC´s than to the Xbox. I dunno.
 
H

hawk2025

Member
hmm.

AMD's market cap is just shy of 2 billion, so it's not like it would be impossible.

Hhmmm.

I wonder how that would shake the console market. Would Sony run to Nvidia, for once?
 
B

Buzzman

Banned
statham said:
The battle for video game console space is very strong. If Microsoft bought AMD, then Sony would be faced with a bad set of choices: put money in Microsoft’s pocket every time it sells a PlayStation, or try to create an entirely new platform by using technologies from Intel, Nvidia, ARM or Imagination Technologies.
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Why would Sony care about that? They already do a lot of business with MS in other ventures.
 
A

anexanhume

Member
SalvaPot said:
Daaaamn, that is 1/4 of every console and I am sure AMD makes a nice profit out of every chip.

But I was under the impression that Microsoft does not values its Xbox brand as much as its PC line, so I want to think buying AMD has more benefits to their PC´s than to the Xbox. I dunno.
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I doubt AMD makes much. They're not in the fab business anymore, so they probably get a set royalty payment per chip.
 
Jinfash

Jinfash

needs 2 extra inches
Would be a smart move, if true. It'll also fuck up the playing field, for better or worse.
 
Pagusas

Pagusas

Elden Member
Caronte said:
I wouldn't mind Intel buying AMD, but Microsoft? Please no.
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that could never happen. the counts wouldnt let it. The only reason AMD even exist in the world is to be an artificial competitor to Intel and keep the illusion of a competitive environment going.
 
F

Felix Lighter

Member
The battle for video game console space is very strong. If Microsoft bought AMD, then Sony would be faced with a bad set of choices: put money in Microsoft’s pocket every time it sells a PlayStation, or try to create an entirely new platform by using technologies from Intel, Nvidia, ARM or Imagination Technologies.
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Why would this necessarily be an issue? I can't imagine MS could buy AMD and then cut of Sony or increase their chip prices. Microsoft earning money doesn't directly impact Sony in this case as far as I can tell.

Caronte said:
I wouldn't mind Intel buying AMD, but Microsoft? Please no.
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You don't want Intel to buy AMD and Intel certainly doesn't want them. I don't know how I would feel about MS buying them either.
 
T

TAJ

Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that.
Perfect Cha0s said:
God please no. The last thing we is one single vendor in the desktop CPU market.
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Doesn't AMD lose their x86 license if they get sold? Same difference.
 
Outrun

Outrun

Member
Wouldn't Sony and Nintendo be paying MS for their respective systems, if this turns out to be a reality?
 
C

Cyd0nia

Banned
How would the likes of Intel feel about the biggest OS and software provider in the world having a vested interest in their competition? How would nVidia feel? How would present AMD management feel about tying their operation to a company that so closely partners with its competitors and a tie up that would reduce their partnerships/contract flexibility?

I'm not saying it won't or couldn't happen but the idea seems insane
 
C

ClosingADoor

Member
This could be interesting. But seems strange since Microsoft is going for the services thing mostly since the new CEO got there. But they do make the Surface, Xbox and Lumia's...

Caronte said:
I wouldn't mind Intel buying AMD, but Microsoft? Please no.
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Why would you want that? Then you only have Intel for PC chips. Some competition in this area will be good.

Outrun said:
Wouldn't Sony and Nintendo be paying MS for their respective systems, if this turns out to be a reality?
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Yes. But that happens all the time. Smartphone manufacturer for example buy components from competitors.

The big thing here would be the development for a new chip for the PS5 or next Nintendo console. They'll need to keep those departments separate if they want to get those contracts and not share info. Also happens, since last generation I think IBM did the chips for both.
 
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