AMD fights for public-sector market share

I’ve just come off an interesting — unusual even — call with Per Bahr, the public-sector business development director for PC chip maker AMD.

Most of the time, when AMD wants to talk about competition, you need to give Intel’s people tin helmets. This odd couple have been at war since time began and journalists have been dining out on the resulting quotes. “Typical, despicable Intel behaviour” was one I had the best part of 20 years ago, although Andy Grove calling AMD “the Milli Vanilli of semiconductors” takes the biscuit. (Note to younger readers, they were a pop act found to have failed to appear on their *own* hits.)

But in 20 minutes on the phone, Bahr made not a single negative reference to Intel, focusing instead on how his company has become a force to be reckoned with in the state sector.

AMD was “almost non-existent in the public sector in 2003 to 2004”, he recalls, but with the launch of the Opteron and commercial desktops, the firm had its first run at the old enemy. Only problem was that tender documents were specifying Intel or else 3GHz processors – an Intel-exclusive commodity at the time. In about 90 per cent of cases AMD reckons it could not bid.

“It was not Intel’s fault,” Bahr says in a quote that might well end up on the walls of the Museum Of Intel Curiosities in Santa Clara. “It was simply a result of them being dominant and their name mistakenly being used [by buyers] as a standard.”

By pointing to EU procurement directives demanding that tenders refrain from using brand names, AMD helped persuade many buyers to use the more open x86 terminology and to use BAPCO benchmarks as indicators of performance rather than gigahertz clock speeds.

One of those changing terms of tenders was the UK Office of Government Commerce. Bahr claims that the OGC saved about £20m by opening up its e-auctions to include AMD-based client systems. Even when Intel wins OGC bids, as it did with Viglen most recently, the citizen gets a better deal than was previously possible, Bahr says. Similarly, he claims the Danish government achieved a 30 per cent saving and boosted volumes of systems in bidding by 40 per cent.

“I can’t point any fingers at Intel although obviously Intel had a vested interest in it not changing,” he says.

AMD says it now has a solid business in the public sector with between a 15 to 20 per cent share in the UK education sector.

“If Barclays Bank wants to specify Intel for 30,000 PCs that’s fine,” Bahr says. “But if the Department of Work and Pensions does that, that’s my and your tax money and there’s no point in lining the pockets of AMD and Intel.”