The last time Advanced Micro Devices (NYSE: AMD) posed any real threat to Intel (Nasdaq: INTC), AMD had an impressive batch of innovation on its hands in the Athlon 64 architecture while Intel was exploring a dead end with the now-defunct and orphaned Pentium 4 series.

Well, here we go again: AMD has just introduced the first few flavors of its long-awaited Fusion architecture, and Intel has messed up its own revolutionary re-creation. Support chips for the Sandy Bridge line of graphics-crunching CPUs turned out to have a serious design flaw that would kill the performance of storage devices over time, and a wholesale recall is in order.

This is the most expensive recall in Intel's history, far ahead of the $475 million write-off for the infamous FDIV bug in the original Pentium. Dell (Nasdaq: DELL) is looking into a plan of action, Hewlett-Packard (NYSE: HPQ) isn't saying much about it, Samsung will repair or replace affected computers, and Apple (Nasdaq: AAPL) hasn't introduced any Macs with Sandy Bridge chips inside yet. No big deal for computer makers, I say; Intel foots the bill for any uncomfortable recall situations here. The effect on computer builders will be limited since only a small number of systems have made it all the way to consumers so far, making this more of a delayed launch issue for Intel itself.

The bug will reduce Intel's first-quarter sales by approximately $300 million as the faulty chips are thrown away and replaced with an improved version. The total cost for the whole affair should land around $700 million, and "full volume recovery" isn't expected until April.

The costs are a minor concern for Intel's shareholders, but that delay gives AMD a three-month window of opportunity to do some damage with those Fusion chips. Only problem, thanks to its ouster of CEO Dirk Meyer, is that AMD is a rudderless ship at the moment and ill prepared to take advantage of Intel's slip-up.

Great timing, guys. I hope the CEO search has unearthed some truly remarkable talent and that your candidate can hit the ground running at 110 miles per hour. Intel doesn't serve up a lot of these disruption opportunities on a silver plate, you know.

Fool contributor Anders Bylund owns shares of AMD but holds no other position in any of the companies discussed here. Intel is a Motley Fool Inside Value choice. Apple is a Motley Fool Stock Advisor selection. The Fool has written puts on Apple. The Fool owns shares of and has bought calls on Intel. Motley Fool Options has recommended buying calls on Intel. The Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.