AMD's Fusion Confusion

Apparently, Advanced Micro Devices (NYSE: AMD  ) thought we needed another definition of "fusion." Say hello to the ultimate payoff of the chip designer's much-maligned ATI acquisition in 2006: a wholesale rebranding campaign for the entire company.

AMD's corporate logo now includes a catchy "The future is fusion" blurb. The company explains: "It's where customer needs, dreams, and desires bond with our own passion for engineering. [...] The future is Fusion. And it's only from AMD."

The chipmaker could certainly use some polish on its public image, which has taken several shots to the gut recently. Intel (Nasdaq: INTC  ) has owned the high-performance chip market since it released the Core 2 product line, relegating AMD to the "value" spot rather than the "top dawg with fat margins" throne. The $5.4 billion ATI acquisition hasn't paid dividends yet, and AMD shares have plummeted from the lower $20s at the time of the ATI deal to $5.50 as I write this.

What is this "Fusion" business about?
In its most obvious sense, Fusion weds AMD's CPU technology to ATI's image-processing expertise. CPUs with integrated graphics cores are expected to launch next year, and the same approach should allow AMD to mix in other specialized chip architectures, such as physics processors, right in the processor itself.

That's not a big surprise after the recent explosion of multi-core processors, but it does take some extra work to make a bunch of different cores work together as efficiently as possible. The payoff could be huge, with improved overall performance, simpler and more compact system architectures, and the ability to mix and match technologies to fill the specific needs of niche markets like high-performance graphics, scientific computing, or plain old gaming.

This is where ATI's rubber meets the road. It's time to prove that the company was worth all those billions of dollars.

But wait -- there's more!
Beyond that obvious definition, Fusion is also "AMD's working philosophy" now, and it "marries innovation with collaboration" to "change the way we live, work and play." From that point of view, I think that AMD could have hired a PR firm to come up with a better name. (I doubt it ever did.)

If you say "Fusion!" in a crowd of technophiles today, they'll think I'm talking about any one of several completely different things:

  • Oracle (Nasdaq: ORCL  ) Fusion is a middleware application suite that includes products from acquired businesses like JD Edwards, BEA Systems, Siebel, Peoplesoft, and many more.
  • VMware (NYSE: VMW  ) Fusion is a virtual machine platform that runs on Apple (Nasdaq: AAPL  ) Mac systems.
  • Compiz Fusion is an advanced window manager for Linux systems, full of spiffy 3D effects.
  • Web.com (Nasdaq: WWWW  ) released NetObjects Fusion 11 this summer, updating one of the oldest Web design tools to current standards and trends.
  • Asian fusion cuisine brings together delicacies from places like India, Japan, Mongolia, and Vietnam on one plate for a deliciously diverse culinary adventure. Yum!

There's plenty more, but you get my drift. "Fusion" may be a trendy choice, but it isn't a particularly original name for a strategy of blending disparate elements into a coherent(-ish) product offering. When you rebrand a whole company like this, you're clearly aiming to stand out from the competition, not blend into it. This particular effort is simply muddling the issue.

AMD would be better off taking a page from the Altria (NYSE: MO  ) playbook -- that name doesn't really mean anything, but it is a unique moniker that sets the company apart from both its rivals and a badly tar-stained history.

"It's only from AMD." Hardly. I applaud the company's effort, but lament its execution. Let's hope that this chipmaker's pudding is chock full of proof.

We've fused together further Foolishness:

Intel is a Motley Fool Inside Value selection. VMware is a Motley Fool Rule Breakers pick. Apple is a Motley Fool Stock Advisor recommendation. Try any of our Foolish newsletters services free for 30 days.

Fool contributor Anders Bylund owns shares in AMD since early 2007 (poor, brave soul!) but holds no other position in any of the companies discussed here. You can check out Anders' holdings if you like. Foolish disclosure would prefer "Melting Pot," "Blender," or even "Amalgamizer Pro" over "Fusion."


Read/Post Comments (4) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On September 19, 2008, at 4:59 PM, Koburg wrote:

    Can you do any better? AMD will return profitibal. You make a joke of AMD. I don't know why. Mabye another puppet from Intel.

  • Report this Comment On September 19, 2008, at 5:11 PM, Mapou wrote:

    AMD's Fusion confusion will be Nvidia’s gain. The Fusion multicore processor is a heterogeneous beast that, like Intel's Larrabee, will be a nightmare to program. Both technologies are trying to marry two incompatible approaches to parallel computing (CPU and GPU). This is truly a match made in hell and they both know it.

    Unlike Intel and AMD, Nvidia’s financial future is not tied to the CPU, an ancient technology that will soon become obsolete in the age of parallel computing. Vector processing is the future of computing and Nvidia’s GPUs are vector processors. Sure, GPUs are not universal parallel processors because they use an SIMD (single instruction, multiple data) configuration. However, this is a problem that Nvidia will eventually correct by switching over to a pure MIMD (multiple instruction, multiple data) vector architecture. Homogeneity and universality are the names of the new computing game and Nvidia is ideally positioned to dominate the processor industry in the decades to come. The writing is on the wall: the CPU is doomed.

    Heralding the Impending Death of the CPU:

    http://rebelscience.blogspot.com/2008/08/heralding-impending...

  • Report this Comment On September 20, 2008, at 5:09 PM, BeauJingles wrote:

    Koburg- --

    Mr. Anders Bylund has been positive on AMD through the entirety of their fall from grace. I would never characterize him as an Intel puppet. Simple read some of his Fool's advisements on AMD in the past, as foolish as they were. If you listened to him, you lost money. Period.

    To Mr. Bylund .. this was a consistent article and spot on. AMD's over use and new implementation of the term is not only confusing, but will dilute the potential marketing from the real device they have always referenced as Fusion when they do finally marry GPU (ATI) to CPU (AMD) ...

    Mapou ... well, this guy is just a kook. Pay no attention. The GPU is a fantastic computational device, but is long far away from doing everything necessary to replace a CPU and cause it to die.

  • Report this Comment On September 21, 2008, at 12:00 AM, IsthisRight26 wrote:

    I agree with AMD branding effort as a counter to "Intel Inside" but also agree that the "unique" aspect of AMD Fusion could have been explained in an easier manner.

    In simple USER term, here is what is unique and beneficial about their platform.

    In the early 80's:

    When the PC was invented, it did 2 things to man machine interaction:

    1/computing and tabulation was done by the user and not a shared machine in the sky

    2/ the engine to realize the visual user experience was able to generate letters ( A to Z), Numbers and special characters.

    We used to think think of "superb" man-machine interaction to be sub-second response time - like an ATM.

    Now we step this up to the 90's. The CPUs were getting faster enough that the PC were computing so fast that the visual aspect of characters and numbers were realized using thousands of pixels and we started to display color graphics - thus the success of Microsoft Windows.

    To achieve dancing graphics, the man-machine interaction was in the fraction of a second ( 10-20 SMALL, NEW frames per second).

    Now we step up to the 2010 era. We expect not only to do the limited graphic animation that we perfected up to now to video quality, but we also expect the PC to enable us to WATCH an HD movie at the same time we RECORD our own video, while RECEIVING and TRANSMIT both VIDEO Streams, while the PC helps us PAY our bills and Balance our checkbook.

    The PC machine that helps us to this the best is "Fusion".

    One day, Fusion will also include a sense for smelling so we detect a rat!

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