CPU 2120

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No way we can duck this story. 🙂

Once upon a time, some people from the Shanghai Supercomputer Center wanted to upgrade their computer so that it would be faster than some Indian supercomputer running a few thousand Intel chips.

So they negotiated with AMD to replace their thousands of Opterons with even more thousands of 2.3GHz Barcelonas to meet their mandated target. No doubt looking for some PR benefit, AMD offered to sell them those thousands of CPUs for a dollar each. No doubt this helped AMD increase its profit margin for the quarter. 🙂

Unfortunately for the Shanghaiers, AMD was unable to supply them with 2.3GHz Barcelonas, and instead shipped 1.9GHz chips, apparently without telling the customer.

Maybe somebody at AMD thought they wouldn’t notice. More likely, somebody promised “the fastest Barcelona that we’re making.”

Unfortunately for AMD, given that this project was a matter of national pride, the Shanghaiers paid a little more attention to this than your grandma does buying a Dell, which means this AMD “sale” is going to cost them at least a million dollars and likely a lot more for the shortfall.

What’s the moral of this story? The next time you want to buy an AMD system:

  • Make a real cool-looking letterhead logo
  • Use it when you write to AMD explaining that you represent the {fill in your address] Superdupercomputing Center, and that you want the 99 Cent Barcelona Super Deal.
  • Buy 5-10,000 CPUs, use a couple, use a few more for keychains, and sell the rest on eBay.
  • OK, $5-$10,000 might be too much of a layout for many of you. If that’s the case, you could try calling your place the Dr. Hector de J. Ruiz Superdupercomputing Center. Maybe they’ll pay you.

    Seriously, folks, this isn’t good. What happens to your PR when you botch a high-profile, patriotism-related sale in a country you consider a critical market?

    Maybe more to the point, this report came out a few days after Cray signed a deal with Intel for a new generation of supercomputers in a few years.

    That deal probably had nothing to do with the Chinese SNAFU. It no doubt had a lot to do with the big fiscal problems the Barcelona delays caused the company.

    Between these two, if you really needed to build a supercomputer (or anything else that needs a lot of CPUs) don’t you think you’re going to think twice about using AMD after seeing these stories? Unless, of course, you get the 99 Cent Barcelona Super Deal?

    It needs to be kept in mind that performance isn’t the only criteria upon which companies choose suppliers. Reliability matters even more.

    Remember that Dell stayed away from AMD for a long time not mainly because of relative performance, but because they doubted AMD’s reliability in delivering the goods. Also remember that when AMD finally satisfied Dell, it left all the little guys gasping for product.

    AMD is down to one functioning fab, with the other basically mothballed until better financial times, so supply problems will more likely worsen rather than improve, especially with all the conversions due to occur.

    Recently, one nVidia exec chimed in about AMD’s future and how closely it’s tied into its finances:

    (Emphasis ours. Unfortunately, the nVidia exec provided exaggerated dollar amounts, we have indicated correct totals in parenthesis)

    “AMD has been declining because it hasn’t built a competitive graphics architecture for almost two years now—ever since the AMD/ATI merger. They’ve been pulling engineers [from the GPU teams] to Fusion, which integrates GPU technology onto the CPU. They have to do four things to survive, but I don’t think they have enough money to do one thing.

    “The first thing they have to do to compete with Intel is the process technology – they have to build the new fabs. The second thing is the next-generation CPU technology. The third one is the next generation GPU technology—we’re going to invest one billion dollars in here this year and they need to invest on the same level to keep up with us. And then the fourth thing is they say the future is going to be this integrated CPU/GPU thing called Fusion. . . .”

    “So they have to do these four multi-billion dollar projects, they’re currently losing [hundreds of millions of] dollars per quarter and they owe [over five} billion dollars. Their market cap is [less than four] billion, so it’s hard to see where the future is in that picture. Really speaking, they’re going to have to pull not one, but several rabbits out of the hat.”


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