AMD-ATI Acquisition

There have been rumours abound about a potential buy out of ATI by processor giant AMD.

At the recently concluded Computex in Taiwan, rumour had it that Intel was in the game as well. The Intel possibility seems to have died down and according to Reuters, AMD seem to be on the verge of a $5.5 billion acquisition of ATI.

What does this mean for the gaming industry?

Well, while ATI has been successful in being the leading supplier of graphics cards in the portable computer space, when it comes to desktops they have had to play second fiddle to market leader nVidia. A merger with AMD could see them increasing their market share in the segment and it could also give AMD a big boost in their market share of AMD powered portable computers.

Currently, notebook manufacturers have to source their CPUs and graphics cards separately, i.e. CPUs from Intel or AMD and graphics cards from nVidia or ATI. There could be huge cost savings in acquiring CPUs and motherboard integrated graphics cards from one supplier. This would also make it a more viable option for the notebook manufacturer who may have more reason to go with AMD power as opposed to Intel.

AMD has always been seen by the hard core PC gaming community as more efficient in the cost-performance ratio. Such a move will also see ATI being able to penetrate that community better.