Microsoft to buy AMD chip manufacturer?

amdFor the majority of us, an AMD buyout would be a costly venture, but for Microsoft, it could be as cheap as chips, with the corporation rumoured to be in line to buy AMD. According to KitGuru, a source claims that Microsoft approached AMD several months ago, with the intention to take ownership of the business.

What makes this believable, is that when you run the numbers and see that for every Xbox One console produced, Microsoft owe AMD $100. It is said that 12.6 million unit Xbox One consoles have been produced already, meaning that Microsoft has already paid AMD around $1.26 billion for Xbox One chips. AMD is valued at $1.81 billion, and Microsoft has roughly $95.3 billion sitting in the bank. Loose change for a corporation of this size, who not too long ago, splashed out on the Minecraft IP along with Mojang for $2.5 billion.

This acquisition would indeed save Microsoft some money in the long run, as long as their console continues to sell, which it will. For every PlayStation 4 console sold, Sony would have to pay Microsoft, but that isn’t such a big deal, considering that Microsoft already pay Sony for the use of the Blu-ray disc drive.

xbox one amdAs Kitguru report “It is necessary to note that Microsoft does not really need AMD. The software giant needs system-on-chips to power its Xbox game consoles, Lumia smartphones, Surface tablets and possibly other hardware devices. It does not really need server processors or high-end graphics cards. However, AMD’s management will unlikely sell a part of AMD to Microsoft since its accelerated processing units (what Microsoft needs) are based on technologies developed for server microprocessors and high-end graphics cards.”

If Microsoft buy AMD, they only need some of what they manufacture, so could the other departments be folded up, or could Microsoft continue to let AMD produce their other technologies and continue uninterrupted? As soon as more details emerge on the potential buyout, we’ll let you know.

[Source: Kitguru]

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