AMD vs Intel: Technology, Competition, and Sustainability

AMD vs Intel: Technology, Competition, and Sustainability
Hugh Folk 1
Technology
Computers will influence everything that is do in the future. Now they store,
process, and communicate all of the information of politics, business, education,
medicine, literature, music, telephone calls, science, and technology. They are our
companions and our teachers. They are our untiring associates in research, invention, and
discovery. Just to prove that they are only human, they sometimes err.
Computers are largely composed of microprocessors and memory chips which are
integrated circuits containing millions, sometimes billions of transistors and are made
largely of silicon, one of the most plentiful atoms in the earth’s crust. The complexity or
number of transistors of the average integrated circuit increases by about 58 percent a
year. Average productivity (output per man hour) in the semiconductor industry
increases by about 27 percent a year. Microprocessors are the part of the computer that
performs the mathematical and logical operations referred to as computing. The speed
and power of a particular state-of-the-art microprocessor design (an AMD Athlon or an
Intel Core 2 Duo) depend on the architecture, or design, of the number and size of the
billions of transistors to be incorporated into each of the several hundred identical dies, or
slivers of processed silicon, on the thin, round 300 mm wafer of silicon and the
conductivity of the lines, or narrow, flat, thin copper wires that will interconnect the
transistors. Each design is put together by experts using specialized computer programs
which combine new or previously used modules to make the patterns for masks through
which extreme lasers project high frequency 248 or 193 nm ultraviolet light which forms
tiny interference patterns on the processed silicon wafers which solubilize the
photoresistant compound previously spun on the wafer. A hundred or more similar steps,
each requiring specialized equipment and reagents arranged in separate work stations to
etch channels, deposit metal interconnects and silicon dioxide insulating layers, or
connect the several layers that make up the chip. Each work station will have automated
wafer manipulation equipment to remove each partially processed wafer from a multiwafer
carrier or cassette, and insert each wafer into a dust free vacuum reaction chamber
where it is processed. Each reaction chamber utilizes a unique, corrosive, toxic chemical
or high-termperature vaporized metal generated on site or pipelined through the dust-free
“clean room” where the processing stations are located. At any step, a single grain of dust
can destroy a die that if completed would sell for several hundred dollars. 2
1 Professor of Management, Shidler College of Business, University of Hawaii at Manoa, folk@hawaii.edu.
2 Fab cost accounting is very strange. Yield, or average percentage of good chips from a wafer, is said to be
critical to economic success, but the market price of the chip itself if only a few dollars per square
centimeter of silicon. That is to say, variables costs are quite low. The fixed cost of the completed design
and the fixed cost (in the billions) of an up-to-date fab and the 60 percent gross margin set the multihundred
dollar price of the microprocessor chip. Design and fab costs are sunk and must be recovered for
2