Having poached top executives from its two biggest competitors, Advanced Micro Devices (NYSE: AMD) hopes to map out a long-term plan where it can return to server product prominence.
AMD's opteron product line helped it gain share in the server market. The company hopes to reclaim that glory.
The company announced recently it hired Donald Newell as its Chief Technology Officer for its server division. Newell was a long-time veteran at AMD rival, Intel (Nasdaq: INTC), where he served as senior principal engineer leading the System-on-Chip (SoC) and datacenter networking architecture groups within Intel Labs. This follows up a May hire from AMD, when it brought aboard Manju Hegde from NVIDIA as corporate vice president of its Fusion Experience Program.
"Don Newell brings a strong combination of leadership skills, engineering and design expertise, and strategic direction," said Rick Bergman, senior vice president and general manager of AMD's Products Group, in a statement. The company said Newell will conceptualize and define AMD's long-term server roadmap.
Analysts say the two hires are likely part of AMD's strategy to win market share in servers. Dunham Winoto, senior research analyst at Avian Securities, said the company hopes to get back to where it was when it introduced the first Opteron processors.
"With the first generation Opteron, they were competitive. They caught Intel by surprise. It took Intel nearly a year to catch up with AMD. They created a product that allowed them to be competitive against Intel, which had never really happened before. All the top OEMs (original equipment manufacturers), IBM (NYSE: IBM), HP and Dell, adopted AMD and sold to their corporate customers," Winoto said.
After the success of Opteron, Intel fought back with products based on its Nehalem architecture and quickly gained back its market share. Today, Intel owns 85 percent of the market in server products. Winoto says bringing aboard people from its competitors in prominent positions is AMD's way of firing back. "They have been trying everything and now they are saying, hey maybe if we hire some people from Intel, that can help," Winoto said.
Recently at the Hot Chips 22 Conference at Stanford University, the company introduced prototypes for two new Fusion processors, the Bobcat and Bulldozer. Both will come out next year. Beyond those, Patrick Wang, analyst at Wedbush Securities, said the new hires will begin to lend their experience and influence to AMD's core processer server products.
"I think if you look at AMD's position long term, they are set up well," Wang said. "They finally have a good CPU product that will be good for notebooks. The ATI acquisition is finally coming to fruition. They've got some good graphic elements. Now you need some tech vision to pull it all together, so they are poaching competitors and the competitors are coming over."
Wang said the hiring of Hegde was especially fundamental to the company's long term success because of his background in fusion, which combine both CPU and GPU, products. Before his stint at NVIDIA, Hegde was Chief Executive Officer and Co-Founder of AGEIA Technologies, a start-up which the former acquired.
"It's a really good fit. He has a solid background being an entrepreneur and getting a couple of his companies picked up," Wang said.
International Business Times, The Global Business News Leader
