Rumor : Microsoft in talks to buy AMD

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Amidst all the rumors of potential AMD acquisitions by Samsung along with the rumors of AMD spinning off its graphics division , a new rumor has appeared : This time its Microsoft who has allegedly approached AMD and shown interest in acquiring the company according to a recent report citing an anonymous source . AMD’s value is estimated at $1.81 billion, which is well within the range of Microsoft’s current cash reserve of $95.3 billion making this acquisition if it indeed does happen , very much possible .

AMD already supplies the SoC’s (System on Chips ) for Microsoft’s XBOX One gaming console as well as its main rival the Playstation 4 from Sony. The Redmond based software giant and the Sunnyvale based chip maker have maintained a close relationship for a very longtime , they have worked together on multiple generations of Microsoft’s API , DirectX, as well as some of the company’s previous generation console : the XBOX 360. Despite their common interests that both companies share in the PC market and gaming, they address these markets through vastly different perspectives.

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AMD provides the SOC’s for the Xbox One

Microsoft, as well as Sony, pay AMD of $100 in royalties on each console produced . If Microsoft bought AMD they would be making HUGE savings and on top of that Sony would be put in a very bad position : Either put money in Microsoft’s pocket every time it sells a PlayStation , or try to create an entirely new platform by partnering up with Intel, Nvidia, ARM or Imagination Technologies .

Microsoft has tried its luck in hardware in more recent times with fairly limited success but its success in the software department does not need mentioning . Whereas AMD is a component maker that specializes in cutting edge graphics and general purpose microprocessors and has only entered the software department recently, again with fairly limited success. Therefore these two giants entering a partnership might seem a win-win situation for them both .

However Microsoft would also have to compete directly with microprocessor and graphics leaders Intel and Nvidia , who will undoubtedly fight tooth and nail to protect their business.

AMD and Microsoft did not comment on the news-story.

 

Suvoparno Banerjee

Suvoparno Banerjee

Student , Gamer , Blogger , Audiophile .