Building Partnerships to Compete in a Global Economy

Alliance for Innovative Manufacturing

Jim Doran, Executive Vice PresidentApril 6, 2004

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Current Events– The new, broader partnership – Spansion– What technology development and manufacturing looks like today

Outline

Building global partnerships to compete in Flash memory

Some background– What does AMD make?– What is Flash memory and why is it so exciting?

Early partnerships– The original joint venture with Fujitsu– Early operations in Asia

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What does AMD Make?

•Micro Processors– Athlon– Opteron

Devices that Devices that processprocess information information

• Flash Memory– Spansion

• Personal Connectivity Solutions

Devices that Devices that storestore information information

Devices that Devices that connectconnect the information the information

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CPG – Develops and delivers world-class computing solutions…

Simplifying Business

Simply the best PC Processor

SERVER & WORKSTATION

DESKTOPMOBILE

The most advanced PC processor for

notebook computing

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…provided by the industry’s leading system manufacturers…

SERVER &WORKSTATION

DESKTOPMOBILE

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…winning awards and satisfying customers around the globe.

SERVER &WORKSTATION

DESKTOPMOBILE

SERVER &WORKSTATION

DESKTOPMOBILE

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AMD is Leading the Industryto Pervasive 64-bit Computing

AMD6432-bit

64-bit

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Flash MemoryFlash Memory

Flash is a special technology

Flash gives products their innate intelligence

I.Q. is proportional to amount of Flash content

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Flash is ubiquitous

IndustrialApplication

Plug in the wall Portabl

e

ConsumerApplication

Handheld PCs & PDAs

Portable Inventory System

Television Set Top Box

GPSNavigation

Automotive Powertrain

Control

Laptop PCs

Automotive Telematics & Infotainment

GameMachines

PCs and Peripherals

Broadband Modem

Internet Routers

Avionics and Instrument

Controls

Enterprise Telecom

Telco Switches

Industrial Controller

Cellular Telephone

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Early Partnerships in Flash Memory…Wafer Fabs

Fujitsu provided– Capital to build new wafer fabs– Manufacturing expertise

AMD provided– Proven technology to build Flash memory– Design expertise

Result– New “JV” fabs to produce Flash memory– Output split by AMD and Fujitsu

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JV1

JV2

ＪＶ１／ＪＶ２

8.24 ． 2001

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Early Partnerships in Flash Memory…Final Manufacturing

Result– Assembly plants in Malaysia and Thailand

Asia provided– Low cost labor– Government support

AMD provided– Jobs– Products and technology

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AMD Thailand Bird’s Eye ViewBangkok facility

05/01/23 141995

1990

2000

2005

2010

$1B

$2B

$3B

$4B

Flash Revenue FASL

AMDR&D

Process TechnologyDesign

FujitsuManufacturing

CapitalMfg. expertise

Competition Intensifies

CompetitorsIntel

SamsungSTM

Others…

TechnologiesNOR

NANDEmerging

Technologies…

Cost IncreasingR&D

Capital

FASL LLCCombined Resources

R&DManufacturingManagement

MarketingAssets >$2.5BEmployees >7K

1993 2003

ChallengeIncrease

competitiveness by combining

resources

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Today’s Partnerships in Flash Memory

Both AMD and Fujitsu now provide– Technology expertise– Manufacturing expertise– Design expertise– Financial support– Access to markets

• Fujitsu strong in Japan and Asia• AMD strong in Europe, US and

Asia

Asia now provides– Lower cost labor– Improved access to markets (China)– Engineering expertise

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The Operations Organization

Technology Development

Memory Technology Development and Manufacturing

Sub Micron Development

Center

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Building a Leading Technology

•Process technology R&D starts in the SDC– Research in next generation process technology

• Lithography• Material science• Interconnect• Analysis and diagnostic techniques

– Focus on technologies for…• Flash memories

– NOR– Mirror Bit– Future

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FAB Problem Solving at the Atomic Level

50 atoms

Void defect

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CS79 90nm Floating Gate Technology

•Stacked gate and contact 1

•Dual damascene Cu BEOL before Cu polish

Poly2 Poly2

Poly1 Poly1

Contact 1

Contact2

Metal2

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The Operations Organization

Technology Development

Memory Technology Development and Manufacturing

Wafer Fab

Sub Micron Development

Center

Fab 25 Austin

FASL Japan

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JV3

8.24.2001

JV3

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The Operations Organization

Technology Development

Memory Technology Development and Manufacturing

Wafer FabAssembly, Test, Mark and Pack

Sub Micron Development

Center

Fab 25 Austin

PenangBangkokSuzhou

Kuala Lumpur

FASL Japan

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Some Conclusions

Good partnerships can help build global competitiveness– Improve access to capital– Provide complementary skills

• Technology / manufacturing• Access to different markets

Partnerships work best when– Both partners provide something– Both partners benefit– Both partners

• Have common goal• Build trust and relationships• Can evolve their partnership over time