AMD CEO Hector Ruiz: Time for a New Business Model in the Semiconductor Industry.Business Editors/High-Tech Writers FEI FEI Fédération Équestre Internationale. Forum on Finance and Technology SUNNYVALE, Calif.--(BUSINESS WIRE)--Sept. 23, 2002 -- FEI Forum on Finance and Technology, Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. -- In a keynote address keynote address n. An opening address, as at a political convention, that outlines the issues to be considered. Also called keynote speech. Noun 1. to financial leaders at the FEI Forum on Finance and Technology Friday, Hector Ruiz, AMD (Advanced Micro Devices, Inc., Sunnyvale, CA, www.amd.com) A major manufacturer of semiconductor devices including x86-compatible CPUs, embedded processors, flash memories, programmable logic devices and networking chips. (NYSE NYSE See: New York Stock Exchange :AMD) president and Chief Executive Officer, asserted that, in order to succeed, semiconductor manufacturers must reinvent their business models to forge tight connections and collaborations with end-users, customers and partners. "In traditional relationships between suppliers and customers, the lines that define where one company begins and the other ends are very clear -- and can be very disruptive," said Ruiz. "I believe this old model is broken. To be successful, we believe that semiconductor companies must build relationships with customers and partners that truly blur the lines, and create a 'complementor' relationship where the companies are connected and invested in each other's success." Ruiz highlighted aspects of AMD's "connected business model" which is focused on forging extremely connected relationships with partners, customers and end-users. "Our industry is in the midst Adv. 1. in the midst - the middle or central part or point; "in the midst of the forest"; "could he walk out in the midst of his piece?" midmost of a fundamental change that will redefine the classic definition of a semiconductor company and rewrite the metrics used to evaluate its success," said Ruiz. "Changes in end-user expectations, increased dependence on silicon to define and differentiate products, the adoption of external value chain integration, and an increasing focus of intellectual property (IP) development based on customer needs rather than manufacturing efficiencies are changing the way AMD does business." Metcalfe's Law "The value of a network increases exponentially with the number of nodes." By Bob Metcalfe, founder of 3Com Corporation and major designer of Ethernet. A network becomes more useful as more users are connected. A primary example is the Internet. , which says the overall value of a network increases exponentially as devices are added to it, is a guiding principle behind AMD's business model. "Just as the value of a physical network like the Internet increases as more users have access, AMD's value and strength will be enhanced by the number of relationships we forge with companies that we will work with to share in a common success." He cited AMD's collaboration with UMC UMC United Methodist Church UMC United Microelectronics Corporation UMC University Medical Center UMC United Microelectronics Corp (Republic of China) UMC University of Missouri-Columbia on cost-effective, high-volume manufacturing of leading-edge microprocessors as an example of a "complementor" relationship where the two companies are connected and invested in each other's success. Ruiz also stressed that semiconductor manufacturers should not stop investing in improving manufacturing capabilities, but rather that companies need to focus on high-impact areas such as transistor development, advanced process control (APC (1) (American Power Conversion Corporation, West Kingston, RI, www.apcc.com) The leading manufacturer of UPS systems and surge suppressors, founded in 1981 by Rodger Dowdell, Neil Rasmussen and Emanual Landsman, three electronic power engineers who had worked at MIT. ), and silicon-on-insulator (SOI (Silicon On Insulator) A chip architecture that increases transistor switching speed by reducing capacitance (build-up of electrical charges in the transistor's elements), and thus reducing the discharge time. The power requirement is also reduced in some designs. ) technology where the IP investment can be directly linked to specific customer needs. "The ability to lower the intensity of capital expenditures, share success with customers and partners, and continue to deliver innovative solutions will be the metrics by which we need to judge semiconductor companies in the coming years," Ruiz continued. Ruiz's presentation is available in AMD's virtual pressroom at www.amd.com/virtualpress/speeches. About AMD AMD is a global supplier of integrated circuits Integrated circuits Miniature electronic circuits produced within and upon a single semiconductor crystal, usually silicon. Integrated circuits range in complexity from simple logic circuits and amplifiers, about 1/20 in. (1. for the personal and networked computer and communications markets with manufacturing facilities in the United States, Europe, Japan, and Asia. AMD, a Fortune 500 and Standard & Poor's 500 company, produces microprocessors, Flash memory devices, and support circuitry for communications and networking applications. Founded in 1969 and based in Sunnyvale, California, AMD had revenues of $3.9 billion in 2001. (NYSE:AMD). AMD on the Web For more AMD news and product information, please visit our virtual pressroom at www.amd.com/news/virtualpress/index.html. Additional press releases are available at www.amd.com/news/news.html. Note to Editors: AMD, the AMD Arrow logo and combinations thereof are trademarks of Advanced Micro Devices, Inc. Other product names used in this publication are for identification purposes only and may be trademarks of their respective companies. |
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