A big picture perspective on the VIA story (courtesy of h0db of Yahoo):
There is a war between Intel and AMD. It is for the future of not only the desktop PC architecture, but the server architecture and the soon-to-be-booming gaming console/internet appliance architecture. The basis for this war is about as complex as the alliance structure that resulted in WWII. The catalytic event that launched this conflict was the Anti-trust case (and victory) against Microsoft.
Microsoft had effectively controlled the architecture by controlling the OS environment. This will soon be over. The next big thing will be embedded OS's in gaming consoles. Intel and AMD are vying to dominate that market.
The stuff you see on Tom's Hardware and Anandtech are distractions. Those are feints and skirmishes aimed at press ink and enthusiast mindshare. No one ever said that the world is fair or that the best technology has to win. Rambus IS the best technology, and the only DRAM technology that can scale right now to keep up with Moore's law. DDR is a legacy bandaid.
The real war is being fought between AMD and Intel among the DRAM manufacturers and silicon foundries of Asia--Korea, Taiwan and Japan. The game is to get AMD and Intel to pay for DRAM conversions and partnerships. DRAM manufacturing has been a VERY marginal profit business for the past decade--look at the consolidation that has taken place in Japan and Korea. The DDR vs. RDRAM war give the industry a chance to make a huge amount of money. They are all holding these hostage to the highest bidder--AMD vs. Intel.
This is why the X-Box victory for Intel was such a big deal. It was the opening salvo in the war. Personally, I believe that the X-box may never be built. But the announcement of Intel's (and Nvidia's) victory has implications for the DRAM wars--it showed that Intel was willing to build the CPUs for the X-box for free, or at cost. Why? To deny the market to AMD, of course, but even more importantly: to ensure that the next generation of Win32-based games for PCs and consoles would use Intel's SSE extensions and architecture enhancements, not AMD's 3D-NOW. Intel could do this because THEY ARE HUGE--they have the fab space to make at-cost coppermine chips. It gives intel a production base through 2004 for .18-m process coppermine cores while other plants are converted to .13+copper Willamette and McKinley cores. AMD does not have the fab capacity to do this.
Taiwan has positioned it's quasi-government-owned semiconductor plants to play the crucial part in the next phase of the war. You may notice that Samsung, and Micron, Hyundai, NEC and the other DRAMurai constantly issue conflicting statements about their production plans for DDR vs. RDRAM. This is not just bad reporting. This is a strategy: they are asking Intel and AMD, "how bad do you want it?" "How much are you willing to pay?" The main pressure has to be on the stronger contestant: Intel. If they pressured AMD too much, they would lose leverage over Intel's wallet. They are using upstart AMD as a stalking horse to get Intel to pay for the conversion to RDRAM production and guarantee profits. Very nice profits from producing RDRAM.
The thing is, consortiums and cartels are weak things. Intel is constantly probing the fissures in these relationship. One weak link is Hyundai--it desperately needs cash, and Intel is dangling $200 Million for RDRAM production. But the weakest link is Taiwan. Taiwan's companies are not part of the seven Dramurai. None of Taiwan's semiconductor companies design DRAM. These companies are also the tightest-knit of any of the major Asia companies. Samsung and Hyundai compete fiercely. NEC, Toshiba, Hitachi, and Fujitsu compete fiercely. And Taiwan holds a unique position in the semiconductor world: 80% of the contract foundry/fab capacity in the world is on Taiwan. When VIA-a fabless design shop--needs to build it's chipsets, it turns to TSMC, UMC and Winbond, Taiwan's home-grown, government-sponsored foundries. When Nvidia or 3DFX need a place to make their graphics chips, they turn to Taiwan. When one of the DRAM manufacturers needs quick capacity, they turn to Taiwan. These are state-of-the-art foundries, using .13-micron and copper-interconnections if required.
Below the Taiwan government, there is a huge conglomerate called Formosa Plastics Group. It's founder is probably the least known and wealthiest billionare in Asia. Under the FPG umbrella are subsidiaries like VIA and TSMC, and also "strategic partners" like FIC--interlocking boards, cross-investment, patent sharing, the works. The Taiwan group is just waiting for Intel to pull out it's wallet, IMHO. VIA would love to settle the Intel patent infringement suit and ITC complaint. It desperately needs a partnership with Chipzilla for it's own CPU plans to succeed. So, the VIA news posted by Oweowepd needs to be read in this light--it is NOT yet a victory by Intel. It is a probe, a signal by VIA that it is ready to talk.
VIA does NOT need a Rambus license to design and build a RDRAM chipset. The license needs to be held by the FOUNDRY. TSMC, UMC, and Winbond ARE ALREADY RAMBUS PARTNERS. The foundry PAYS the ROYALTY. It's all there at www.rambus.com.
So the war is far from over, but I think that Intel is very close to playing the Taiwan option. That is the whole point of the lawsuit against VIA: not to break them, but to leverage them against AMD. VIA had assumed a KEY position as AMD's partner. AMD NEEDED VIA to build the chipsets for Athlon and thunderbird/duron, and to build the DDR-SDRAM chipsets as well. THIS IS NOW IN DOUBT: I posted weeks ago information from Aces' hardware about the fallout between AMD and VIA. AMD now says that the first DDR-SDRAM chipset will NOT be from VIA, but from ALi. Acer Aladdin (ALi) is one of the few big Taiwan companies that is not connected with FPG. This is a desperation play by AMD. ALi is not even in VIA's league.
Why do you think AMD's stock price had fallen like a rock after posting record profits? AMD announced a split, and the stock dropped like a rock. AMD hinted that next quarter's earnings are going to be great, and the stock fell like a rock! Because people can see the writing on the wall.
Thank you, h0db.
BP |
