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Intel's new chipset strategy hits ATI

Posted: 14 Apr 2006 ?? ?Print Version ?Bookmark and Share

Keywords:Mark LaPedus? ATI Technologies? Intel? chipset?

An investment banking firm has downgraded ATI Technologies Inc. amid reports that Intel Corp. is revamping its third-party chipset strategy.

For some time, Intel has been using third-party chipsets from ATI and others to keep up with OEM demand in the PC market. Intel has also been forced to use third-party chipsets, due in part to a lack of fab capacity and shortages for its own chipset lines.

One investment banking group, Friedman Billings, Ramsey Group Inc. (FBR), believes that many OEMs are not using or re-designing their PC motherboards, based on Intel's microprocessors and ATI's chipsets. Instead, many OEMs are opting to use systems, based on processors from Advanced Micro Devices Inc., according to FBR.

As a result, Intel is re-thinking its third-party chipset strategy. The microprocessor giant is reportedly "outsourcing" its production of all non-PC products, thereby providing more fab capacity for its own chipset lines, according to FBR.

Intel, however, is moving to use third-party notebook chipsets from ATI, according to the firm. But still, FBR downgraded ATI from "outperform" to "market perform" due to a slowing PC market, coupled with what the investment banking firm "believes to be a shift in Intel's chipset strategy that could affect ATI's 2H chipset volume."

- Mark LaPedus
EE Times

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