Globalfoundries Starts on 22nm Fab & Announces First non-AMD Customer

Final Words

When AMD announced that it would be spinning off its fabs it was honestly the only decision the company could have made. Even while continuing to hemorrhage money after the announcement, the move has the potential to succeed just like the ATI acquisition did; it'll just take a while.

A leaner AMD, focused almost entirely on design and not on keeping fabs full is a better match for Intel. AMD could never compete on manufacturing alone, but at least this way it has the opportunity to compete on technical design.

Decoupling manufacturing from microprocessor design wouldn't make sense without the help of ATIC. The $6B investment is enough to give Globalfoundries the chance to start and succeed. AMD simply wouldn't be able to do this without ATIC.

As an independent entity, Globalfoundries itself can do quite well. Microprocessors are becoming increasingly important in the world. The demand for tons of cheap, high performance, low power SoCs and microprocessors is supported by what we've seen happen with smartphones and netbooks. The trend is going to continue and while I'm sure we'll see only a couple of SoC makers dominate the market in the end, they will need a place to make their chips.

Upstate NY used to be known for making potato chips, now it'll be known for making computer chips. Clever.

The impact of all of this on the US and NY economies is pretty huge. It's all pretty sweet. Over the next three years a $4B building gets created, which means jobs for construction workers, additional revenue for everyone who makes the things buildings are made out of and eventually extra revenue for companies that make microprocessor manufacturing tools. Then, once the building is complete, you get a plant of 1400 people. Many of them are highly skilled workers, their total yearly salary being $88M. Their families move into the area, everyone buys homes or rents apartments, they all shop, eat out, go to movies and the entire local economy benefits.

Of course you have to feed the plant with new hires and luckily there's a big nanotech school graduating really smart folks a few miles away. They now have a place to work and the school has another very appealing employment path to offer its students, attracting even more to its campus.

NY's Governor David Paterson and Hector Ruiz. The fab deal is quite political.

All of this from a single fab being made in upstate NY. Did I mention that there are two more spots to build fabs next to Fab 2 Module 1? The rumor is that ATIC wants the next one built in Abu Dhabi though (after all, that is where the money for all of this is coming from).

With money in the bank we won't have to worry about Globalfoundries lasting through the recession. Now it's a matter of who the next customers will be.