Few would claim the AMD/ATI merger this point has gone well. John Peddie Research claims ATI only commands a 17.5% share of the graphics market currently, representing a loss in market share. This comes at the same time that NVIDIA, ATI’s largest rival, is posting record profits with its first billion dollar quarter.
AMD’s Richard Huddy said last week that GPU physics is dead for now after the Intel acquisition of Havok. AMD may consider the purchase of physics hardware manufacturer AGEIA; a topic that comes up every three months apparently.
A purchase of AGEIA would allow direct competition between AMD and Intel in the physics world and could open up the ability for hardware based physics acceleration on ATI graphics cards and in AMD processors.
The biggest reason the purchase of AGEIA by AMD is not likely to happen is one of cash.
Huddy recently told Custom PC, “Our biggest problem is that Havok reputedly cost in excess of $100 million. If I’d been valuing Havok, I’d have valued it at probably something like 10 per cent of that because they were in so much trouble in the marketplace, but realistically they did have some valuable IP, and you really can capitalize on that if you’re Intel in this situation.”
“If AGEIA want to command a comparable price,” said Huddy, “then that’s a pretty significant problem for AMD. No one would think of us as cash rich at the moment, so splashing an extra $100 million just to get physics, which is a niche market, is quite an issue for us.”
Few would consider AGEIA to be flourishing in the current market place with the adoption of their hardware physics accelerators waning. However, that could possibly change in the future with the mobile physics accelerator AGEIA announced in August of 2007.
AGEIA, which has minimal product support right now, might not be in that bad of shape. Even competitor Havok agrees hardware-physics competition from GPU manufacturers (including AMD) may not take form until Microsoft releases its next-generation API layer.
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