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AMD and GlobalFoundries renegotiate 32nm deal

AMD and GlobalFoundries renegotiate 32nm deal

AMD is now paying Global Foundries on a per-chip basis, rather than per-wafer.

AMD and GlobalFoundries have renegotiated a silicon supply deal, which will see AMD switching to a per-die payment method for any chips produced on GlobalFoundries' new 32nm manufacturing process.

The revised agreement replaces the previous per-wafer payment deal that AMD's had since it span off its manufacturing wing to create Global Foundries.

In a press statement, AMD said that from now on its 'price for 32nm products will be based on good die,' implying that AMD was previously seeing a few too many duff dies per 32nm wafer for its liking, and therefore only wanted to pay for working chips.

As an added incentive, AMD has also pledged to play a quarterly sum to GlobalFoundries next year, on the condition that the chip fabricator meets 'specified conditions related to continued availability of 32nm capacity' at the beginning of the year.

Are you looking forward to AMD’s offerings this year? Are you worried that problems at GlobalFoundries could hold back the release of AMD’s forthcoming processors? Let us know your thoughts in the forums.

14 Comments

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Cthippo 5th April 2011, 16:50 Quote
Trying to decide if this means anything or not. It will probably save AMD a few bucks, but if GF can't produce good yields then it doesn't matter what AMD is paying for them.. In addition, I think GF is doing everything it can to produce quality product, and the costs will probably even out in the end.
Tech NoOb 5th April 2011, 16:54 Quote
Hopefully AMD's new chips will be a match for Intel and thus provide some serious competition, choice and competitive pricing.
mjm25 5th April 2011, 17:11 Quote
i read somewhere else that although it's not ideal for Global Foundries they're still massively above any warning level on the money they make per wafer. Probably why the deal was renegotiated so cleanly.
cgthomas 5th April 2011, 17:21 Quote
Quote:
Originally Posted by Tech NoOb
Hopefully AMD's new chips will be a match for Intel and thus provide some serious competition, choice and competitive pricing.

I they start matching Intel's performance then expect prices that match Intel
derpooch 5th April 2011, 17:44 Quote
Hopefully this will improve the yields, and AMD will be able to release Bulldozer/ Zambezi sooner, which will be able to compete with Sandy/ Ivy bridge, and we will get nice, fast, cheap as chips, chips!
/optimism
Xir 5th April 2011, 18:54 Quote
Shouldn't change anything, I don't suppose GF has been skimping on quality "just-because-they-can".
Also, AMD managed the place long enough to know what kind of yields are normal.
schmidtbag 5th April 2011, 19:07 Quote
Quote:
Originally Posted by cgthomas
Quote:
Originally Posted by Tech NoOb
Hopefully AMD's new chips will be a match for Intel and thus provide some serious competition, choice and competitive pricing.

I they start matching Intel's performance then expect prices that match Intel

i wouldn't expect that so soon. if amd exceeds intel in performance, they'll still have the lower price because they want to attract more users. the only thing keeping amd alive right now is their bargains, if they charge more than intel immediately after their next releases, that leaves no one with a good deal. even back when amd released the athlon 64, that was overall faster but intel still charged more.

if amd continuously exceeds intel in performance (which is unlikely), then expect a price raise.
Snips 5th April 2011, 19:28 Quote
Nothing in this topic or posts suggest that by doing this, it would somehow improve the quality of the AMD product.

Why assume it would?
Lazy_Amp 5th April 2011, 20:31 Quote
Quote:
Originally Posted by Snips
Nothing in this topic or posts suggest that by doing this, it would somehow improve the quality of the AMD product.

Why assume it would?

It can't improve the product, but it probably will help to keep the price of new AMD processors stable if they don't have to repay the losses caused by poor yields. More importantly though, it sends a message to GF to hold to their commitments on new processes: Intel 32nm has been out for one and a half years after all. Since roadmaps are saying that Intel could have 22nm ready by the end of the year (probably no products until early 2012), AMD wants the next step, a 28nm bulk process, ready from GF as soon as possible.

Luckily, there are other companies who are also pushing GF for 28nm (namely ARM), unlike 32nm where AMD was GF's only customer, so it is hopefully more likely to stay on track.

Also, have another article that puts the deal in a little more perspective: http://semiaccurate.com/2011/04/04/amd-and-global-foundries-agreement-not-what-it-seems/
Cthippo 5th April 2011, 23:44 Quote
Quote:
Originally Posted by schmidtbag
i wouldn't expect that so soon. if amd exceeds intel in performance, they'll still have the lower price because they want to attract more users. the only thing keeping amd alive right now is their bargains, if they charge more than intel immediately after their next releases, that leaves no one with a good deal. even back when amd released the athlon 64, that was overall faster but intel still charged more.

if amd continuously exceeds intel in performance (which is unlikely), then expect a price raise.

Historically, when AMD has matched Intel's performance, Intel's prices have dropped like a rock
Teh Noob Slayer 6th April 2011, 00:28 Quote
Quote:
Originally Posted by Cthippo
Historically, when AMD has matched Intel's performance, Intel's prices have dropped like a rock

Yup, their respective prices tend to drop somewhat in a mini price battle. I'm sure consumers would be happy for cheaper Sandy Bridges.
Skiddywinks 6th April 2011, 00:48 Quote
From what I have read, yields are fine as it is. This renegotiation is curious to say the least.
Xyllian 6th April 2011, 07:57 Quote
Another thing to keep in mind is that both companies are owned by the same people, i think this is simply redistributing of some of the GloFo profit to AMD.
J!n 6th April 2011, 13:01 Quote
GF (GlobalFoundries) are a good company and all but GF get in that FAB and make me some chips.
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