AMD, IBM Join Forces Against Intel

Advanced Micro Devices Inc. and IBM Corp. said Wednesday that they have formed a partnership to develop technologies for making high-performance computer chips in an attempt to strengthen both companies’ positions against industry giant Intel Corp.

The joint effort will improve the performance of semiconductors and reduce the amount of power they consume, the companies said. AMD and IBM plan to focus on techniques such as adding material to silicon wafers to enhance transistors, the microscopic components of chips that transmit information

The companies aim to produce chips with transistors spaced only 45 nanometers to 65 nanometers apart, about 2,000 times narrower than a human hair. By packing transistors closer together, the chip can process information faster and use less power. The partners hope the 65-nanometer chips will reach the market in 2005.

Sunnyvale, Calif.-based AMD already is planning to produce chips with transistors spaced 90 nanometers apart and bring them to market in the first half of 2004. Meanwhile, Intel is expected to ship a 90-nanometer version of its Pentium 4 chip in the second half of this year.

Santa Clara, Calif.-based Intel holds about 80% of the global chip market.

The companies did not disclose financial terms of the partnership or what types of devices would use the new chips. In New York Stock Exchange trading Wednesday, AMD shares dipped 48 cents to close at $6.69, while IBM of Armonk, N.Y., dropped $1.81 to $84.19. Intel’s stock lost 68 cents to close at $16.68 on Nasdaq.