AMD needs to more than double its share of the microprocessor market to survive, according to a brief filed by the company’s lawyers in its antitrust lawsuit against Intel. At the end of 2007, AMD had 13% of the processor market, “less than half of what it requires to operate long-term as a sustainable business,” the brief said, explaining that Intel’s alleged efforts to shut the company out of the processor business had largely succeeded.
“Measured on a revenue share basis, AMD made little progress growing its slice of the pie,” it said.
The argument that Intel’s alleged anti-competitive behavior has so hurt AMD that its future is in jeopardy is crucial to the company’s claims for relief, including damages. But the claims could further spook corporate customers already wary of the company’s financial troubles. “It will push them in the other direction,” said Rajnish Arora, director of enterprise server and workstation research at IDC Asia-Pacific.
AMD’s brief was heavily redacted by the court and details of Intel’s alleged anti-competitive behavior and its relationship with major computer makers were largely blacked out. But the general thrust of AMD’s argument was clear: Intel allegedly paid computer makers to rely exclusively, or almost exclusively, on its chips.
The effect of these and other alleged tactics employed by Intel outweighed gains that AMD made with its successful line of Opteron server chips, which came out in 2003.
“That AMD gained some share and revenue is immaterial. It gained sufficiently less share and sufficiently less revenue so as to suffer a critical diminishment of its innovation roadmap,” the AMD brief said.