AMD, ATIC Launch Chip Manufacturing Company Globalfoundries

Advanced Micro Devices and Advanced Technology Investment Company announce a joint venture in processor manufacturing called Globalfoundries that looks to have global reach as a semiconductor foundry. The anticipated venture between AMD and ATIC, coming the same week that AMD's desktop and notebook chip rival Intel and TSMC made public a new relationship, includes expansion plans for an upstate New York campus, creating 1,400 area jobs.

As predicted, Advanced Micro Devices has announced the creation of Globalfoundries, the business formed through the spinoff of the AMD's own chip manufacturing business. Globalfoundries is a joint venture between AMD and Advanced Technology Investment Company, of Abu Dhabi, United Arab Emirates.

The move enables AMD to pass its manufacturing business to Globalfoundries, freeing $1 billion from its books and allowing it to focus on product marketing and processor design, especially when competing against chip giant Intel.

"Globalfoundries will service the manufacturing needs of AMD and will also offer an expanded road map of technologies to third-party customers through its high-volume, global foundry services," said a March 4 statement announcing the official name of the company. "This means that for the first time, early access to volume chip production using leading-edge technologies will not just be limited to only high-end microprocessor makers."

In addition to AMD, another new customer will be ARM, a processor intellectual property licenser.

"As consumers move to increasingly smaller and more energy-efficient devices, we need to remain aggressive in our technology development and ensure [that] we have a full range of foundries available for our partners to get those products to market," Simon Segars, executive vice president and general manager of ARM, said in a statement.

Globalfoundries is headquartered in Sunnyvale, Calif., and begins operations with approximately 2,800 employees worldwide.

Expansion plans already include a facility located in Dresden, Germany, to be up and running by late 2009. In addition, Globalfoundries is planning the construction of a $4.2 billion manufacturing facility at the Luther Forest Technology Campus, in Saratoga County, N.Y., which is "expected to create approximately 1,400 new direct jobs and more than 5,000 indirect jobs in the region."

The announcement of Globalfoundries comes just two days after Intel and TSMC (Taiwan Semiconductor Manufacturing) announced a "memorandum of understanding," in which TSMC will handle manufacturing for joint projects in the future. Additionally, Intel will port its Atom CPU to TSMC's technology platforms, and TSMC will have access to Intel IP and designs.

As with the AMD and ATIC collaboration to create Globalfoundries, the goal of the Intel and TSMC agreement is to create avenues through which to innovate within new markets.

"The announcements are absolutely tied," said John Spooner, an analyst with Technology Business Research. "Globalfoundries is announcing its existence and putting up its shingle and saying to chip makers, 'Come kick the tires and look at our technology. See what we have to offer. And, of course, we'd like your business.'"

While the two announcements are different in their specifics, Spooner said, there's no coincidence in their timing. "As far as having the most advanced technology, Intel is usually the fastest. What used to be AMD is relatively close. Of the foundries, Globalfoundries may now be the quickest to offer the newest technologies," Spooner said.

After some anticipation, Globalfoundries has announced itself, Spooner said, "and now it's time for them to go out and earn some money."