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Qualcomm grabs AMD handheld, graphics tech

Communications chipmaker buys handheld assets from Advanced Micro Devices, including graphics chip technology. AMD will get $65 million in cash.

Brooke Crothers Former CNET contributor
Brooke Crothers writes about mobile computer systems, including laptops, tablets, smartphones: how they define the computing experience and the hardware that makes them tick. He has served as an editor at large at CNET News and a contributing reporter to The New York Times' Bits and Technology sections. His interest in things small began when living in Tokyo in a very small apartment for a very long time.
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Brooke Crothers
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Qualcomm has picked up handheld assets from Advanced Micro Devices, including graphics chip technology.

San Diego, Calif.-based Qualcomm and Sunnyvale, Calif.-based AMD announced on Tuesday that Qualcomm has acquired graphics and multimedia technology assets, intellectual property and resources that were "formerly the basis of AMD's handheld business."

The acquisition includes "graphics cores that we have been licensing for several years," said Steve Mollenkopf, executive vice president of Qualcomm and president of Qualcomm CDMA Technologies, in a statement.

The agreement provides Qualcomm with "vector graphics and 3D graphics technologies and IP," AMD said in response to an e-mail query.

AMD would not provide further details on what Qualcomm got but said that AMD's handheld graphics is centered on "unified shader architecture" technololgy that has been used in Microsoft's Xbox, for example. "We have not disclosed the specific assets and technologies that Qualcomm has acquired. Our Handheld 3D graphics technology is based on unified shader architecture," the AMD spokesperson said.

AMD, however, did make it clear that the agreement does not include its Imageon processors. "The agreement does not include the AMD Imageon processor products, the Imageon brand, or any existing Imageon customer commitments," an AMD representative said.

"AMD will retain rights to the AMD Imageon products," the spokesperson said. "We intend to honor existing customer commitments for the currently available AMD Imageon products, including the A250 application processor and the M180 media processor, for the remaining lifecycle of these products."

AMD added that it will not update the Imageon road map. "We will not add any new AMD Imageon products to the road map," according to the representative.

With the acquisition in 2006 of ATI Technologies, AMD became a leading supplier of media processors to the handheld and handset device market through ATI's Imageon line.

Under the terms of the agreement announced Tuesday, Qualcomm said it has extended job offers to various design and development teams from AMD's handheld business. "The teams are developing technologies to enhance mobile devices in areas including 2D and 3D graphics, audio/video, display, and architecture," Qualcomm said.

AMD will get $65 million in cash. Qualcomm expects the acquisition to be approximately 2 cents dilutive to pro forma earnings per share in fiscal 2009 and accretive to earnings by the second half of calendar year 2010.