AMD's Xbox One Deal Valued At More Than $3B

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Who will be the big winner in the upcoming PS4 vs. XBO console wars? AMD, the company powering all the next-gen consoles. ;)

Posting on his LinkedIn profile, the former AMD vice president of Strategic Development stated that AMD had signed a multi-year deal with Microsoft valued at over $3 billion. The posting also revealed that AMD provided a "custom silicon solution" to Microsoft for the Xbox One.
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I read the book "The Race for a New Game Machine: Creating the Chips Inside the XBox 360 and the Playstation 3" which had IBM creating both console's CPUs. Both Microsoft and Sony were there at the same time on different floors.

Great book BTW..

I wonder if AMD will be the same way?
 
Good for AMD. Hopefully that money can get them back into game on the PC CPU front. I haven't even needed to consider them for the last few years..
 
They may even be willing to cut Sony a deal on their Silicone just to stick it back to Microshaft.

Just sayin.
 
DonDon said:
They may even be willing to cut Sony a deal on their Silicone just to stick it back to Microshaft.

Just sayin.
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I was thinking the "fall-in-line" Intel Lemmings might be a bit miffed. But then again...who cares about them anyhow. :cool:
 
So since Microsoft expects to sell 400 million xboxs and the deal is for 3 billion. That means its $7.5 per motherboard for AMD. That deal kinda sucks.
 
If both consoles sell as predicted, you can take that number and double it (at least), mostly likely triple it. It's quite a boon for AMD. Just proves once again how lame the so-called stock analysts are as it seems none of them understood what was happening with AMD and the consoles wins--even after Sony announced it had awarded the contracts to AMD...! That's fairly amazing when you think about it--how *do* these people keep their jobs, much less get listened to?
 
Despite their other mistakes, setting themselves up as basically the only players in the APU market will be pretty helpful.
 
I hope it work out for AMD in the long term, I absolutely dread a world where Intel is the only CPU supplier left.
 
So if the deal between AMD and Microsoft is around 3 billion I can imagine their deal with Sony is valued around the same. So that's quite a bit of cash for AMD right there from two console giants.
 
WaltC said:
If both consoles sell as predicted,
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The problem being that microsoft is already predicting to sell a console to every Americana and European household (300 million apx) plus 100 million more. I find that prediction to be highly overprojected.
 
dara said:
Good for AMD. Hopefully that money can get them back into game on the PC CPU front. I haven't even needed to consider them for the last few years..
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Doesn't mean they will spend them to get back in the race for high performance CPU. AMD has long left that segment and I don't think they are going back. They will probably continue to focus on APU and mobile segment if that's where the money is.
 
Hornet said:
Doesn't mean they will spend them to get back in the race for high performance CPU. AMD has long left that segment and I don't think they are going back. They will probably continue to focus on APU and mobile segment if that's where the money is.
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I imagine since the apu segment is off in full force and the opteron is doing fine, this money goes to their ultra mobile where they let everyone, including intel, catch them with their pants down.
 
Good for AMD, Intel has several markets dominated, plus maybe now amd can get their head a bit above water and back in the black instead of posting losses all the time. I like xbox 360 but this new gen console coming out looks ugly then again who cares as long as the graphics are good.
 
Hornet said:
Doesn't mean they will spend them to get back in the race for high performance CPU. AMD has long left that segment and I don't think they are going back. They will probably continue to focus on APU and mobile segment if that's where the money is.
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I really don't think they left that segment long ago.

FX hits high clock speeds, and I suspect before the timeline is up for that architecture it will show it's potential.

they just said they are out of it, but really, having a bleeding edge processor trickles down to all market segments. I suspect AMD will be CPU competitive in the next few years, intel will get lazy again, because they can.

time will tell.
 
Does this mean pc ports of console games will work better on pc's using AMD video cards? Since the new consoles will both have AMD gpu's?
 
Wait, where does Microsoft expect to sell 400 million Xbox One consoles??
 
Excalibrax said:
So since Microsoft expects to sell 400 million xboxs and the deal is for 3 billion. That means its $7.5 per motherboard for AMD. That deal kinda sucks.
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And they probably cost AMD $3 to make.

You don't think those high end GPUs actually cost $200+ to make do you?

Plus its constant revenue, the kind that keeps a company moving and liquid.

You lose a little there, make a little there.
 
Hornet said:
Doesn't mean they will spend them to get back in the race for high performance CPU. AMD has long left that segment and I don't think they are going back. They will probably continue to focus on APU and mobile segment if that's where the money is.
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I think it is. The more I see it from my customers, none of them need or want to pay for a i7 and also probably an i5 too. Even I don't need them anymore really.

For most folks Intel has just zoomed off over the horizon. Totally irrelevant.

Sure folks here and some folks that need the horse power love it but that group is getting smaller every year.

If AMD just started marketing itself to Joe Average things would turn around.
 
daglesj said:
I think it is. The more I see it from my customers, none of them need or want to pay for a i7 and also probably an i5 too. Even I don't need them anymore really.

For most folks Intel has just zoomed off over the horizon. Totally irrelevant.

Sure folks here and some folks that need the horse power love it but that group is getting smaller every year.

If AMD just started marketing itself to Joe Average things would turn around.
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I know I love the prices for the AMD processors. That's what I've been looking at in case the PS4 and Xbox One fail to impress me...
 
Excalibrax said:
So since Microsoft expects to sell 400 million xboxs and the deal is for 3 billion. That means its $7.5 per motherboard for AMD. That deal kinda sucks.
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Even if your numbers aren't exact it was discussed before. To be awarded this contract they had to come in lower than intel and nvidia cost per chip.

Low margins are still low margins no matter how many units you ship. So while AMD is making tons of xbox chips intel and nvidia can make money in other areas. It could seriously hurt AMD in the long run.
 
Well an APU is inherently cheaper since everything is on one chip (although a big ass one in the case of the consoles), memory is shared, etc. Nvidia and Intel can't compete, they don't have a similar product and it would cost them lots to conceive one, while still not be proven like AMD's APUs are.

Now one key difference between AMD and Intel is that AMD is now fabless, so they have to buy the chips/production slots from GloFo.
 
stealthy123 said:
I really don't think they left that segment long ago.

FX hits high clock speeds, and I suspect before the timeline is up for that architecture it will show it's potential.

they just said they are out of it, but really, having a bleeding edge processor trickles down to all market segments. I suspect AMD will be CPU competitive in the next few years, intel will get lazy again, because they can.

time will tell.
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I agree and I don't think they left the high-end segment on purpose. The FX CPU is a failed attempt at a high end CPU. It has all the traits of a high-end CPU..except performance... Core count, TDP, clock speeds and the FX branding all show how AMD were hoping to position it.
 
Megalith said:
No one wanted to work with Nvidia?
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The next gen consoles are using APUs. If they chose Nvidia then Sony and Microsoft would still need to seek out processors which would increase cost and design complications. Not to mention that I doubt Nvidia would let themselves be low balled at all.
 
dara said:
Good for AMD. Hopefully that money can get them back into game on the PC CPU front. I haven't even needed to consider them for the last few years..
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The real question is, How much making any money on the deal?

Doesn't help if they are losing money on each chip.
 
nutzo said:
The real question is, How much making any money on the deal?

Doesn't help if they are losing money on each chip.
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Its not always about dollars per chip.

Does the deal look good to the markets? Does it boost the share price?

If you have partners like MS and Sony signed up then banks tend to look more favourably at you and will work with you. You can then borrow more to fund other projects that will bring in money.

The benefits of such deals often are not all about pure profit.
 
This is why I bought some shares in AMD. I am small time when it comes to stocks, but so far my only regret is not buying more shares.
 
daglesj said:
And they probably cost AMD $3 to make.
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Much smaller chips AMD sells costs a lot more than $3 to manufacture. ;)

From the high res pictures Wired has of the Xbone, the chip appears to measure approx 24mm x 15mm (360mm^2). It could easily cost $35-$40 to manufacture, given very favorable yields and foundry pricing, and may cost even more than that. (hidden wizard math: TSMC's price to process a 300mm wafer divided by [die candidates times yield])
 
IBM Won the Last Video Game War.
Not only did they design the for the PS3 and Xbox, but they also handled the Wii.
This time, AMD Came in big, although IBM still had a hand on the Wii U Processor, AMD still has its hand on the Wii U with it's GPU.
Although for Sony, the AMD GPU is a strange choice for a company that relies on OpenGL since it can't use DirectX which is Microsofts... Same with the WIi U. Maybe that's why Microsoft has done a better job at designing its consoles. Use things that match with each other.....
 
soulman901 said:
IBM Won the Last Video Game War.
Not only did they design the for the PS3 and Xbox, but they also handled the Wii.
This time, AMD Came in big, although IBM still had a hand on the Wii U Processor, AMD still has its hand on the Wii U with it's GPU.
Although for Sony, the AMD GPU is a strange choice for a company that relies on OpenGL since it can't use DirectX which is Microsofts... Same with the WIi U. Maybe that's why Microsoft has done a better job at designing its consoles. Use things that match with each other.....
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Wut?
 
pxc said:
Much smaller chips AMD sells costs a lot more than $3 to manufacture. ;)

From the high res pictures Wired has of the Xbone, the chip appears to measure approx 24mm x 15mm (360mm^2). It could easily cost $35-$40 to manufacture, given very favorable yields and foundry pricing, and may cost even more than that. (hidden wizard math: TSMC's price to process a 300mm wafer divided by [die candidates times yield])
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Yep they may cost $35 to manufacture now.

But 1-2-3+ years from now they will cost a great deal less. Chances are by 2019 they will cost $2 a go. So over the 8 years the average cost to manufacture -

$3!
 
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