ATI acquisition might be key to AMD's future success

Without a doubt, 2007 was a bad year for AMD.  A price war with Intel, the acquisition of ATi, chip delays, and chip bugs.  Any one of these would have been bad, but all of these combined meant that AMD had a really tough year.  But 2008 could be a much better year for AMD.

Yesterday AMD announced yet another quarterly loss - now the fifth is succession.  On top of that, revenues were virtually unchanged from a year ago.  But quad core sales and the acquisition of ATi could represent a turning point for the company in 2008.  While picking up ATi has without a doubt been an expensive move for the Sunnyvale company, I also see it as being key to its future success.

Having ATi close at hand means that AMD can develop platform solutions such as the Spider where the silicon in the CPU is supported by the silicon in the GPU.  While Intel has some excellent CPU silicon on offer, the company would have a much harder time coming up with a platform.  Also, buying ATi meant that AMD could pursue projects such as Fusion - a CPU and a GPU on the same piece of silicon. 

The thing that AMD needs to be mindful of during 2008 is delays.  You can have the best products in the world, but if they're not available then they're not going to do the company any good.

Then there's the server market.  This is a crucial market for AMD and one that's profitable.  Revised quad core Opterons are now needed quickly so the company can regain traction. 

Thoughts?