Stability of supply, yes.
A CPU manufacturing plant is MUCH more expensive than it was a few decades ago. Intel has been around for a very, very long time, and got in quickly on establishing themselves. AMD was actually licensed by Intel to produce Intel-like CPUs, like 20 other manufacturers.
AMD is the only one that is still around.
And you'd never believe who was responsible for that licensing agreement:
IBM.
That's right. IBM.
As per company policy, IBM will not do business with a supplier that is the only source of a product. So when they wanted to build a PC based on Intel's 8086, Intel simply licensed the technology out. Voila, multiple suppliers, IBM is happy, let's get down to business.
And the x86 IBM PC was born. The rest is history.
You might be shocked that AMD is going to go to .13, but you have to think about it this way: since .13 is relatively new (for mass production), there's only so many places that will manufacture anything in .13 . This means that AMD was facing a shortage of supply, again...
So they fixed it. They found a partner that is ready to manufacture in .13 right now, in a necessary quantity for AMD to stay competitive. As part of the agreement, this plant will use some of AMD's technology to improve the chips that they make for other companies, and in return, keep their plant up-to-date.
AMD could barely afford to build a new plant, and let's face it, it would be a very bad business decision: AMD would have all of its resources and capital invested in the production of only one product. This NEVER sits well with investors.
Welcome to Corporate America.
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