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ATI Brand Discontinued, New Product Line Does Not Impress

On 2010 did a move that is arguably the worst decision in the recent history of the company. The Sunnyvale, California-based firm started to phase out the ATI graphics cards brand it obtained with ATI Technologies back in 2006.

The loss of ATI letters from the logotype of Radeon graphics processors marked AMD's intention to unify the brands of products that are developed within it and emphasize the importance of the company. The move was also made to underline the importance and united nature of Fusion processors containing central processing units developed by AMD and graphics processing units designed by ex-ATI teams. Unfortunately for AMD, the 25-years old ATI trademark was just too recognizable and the new family of AMD Radeon products is just too pale to actually overshadow it.

Even though many say that it is not necessary to pay for well-known brands, consumers love recognizable labels and trademarks and are willing to pay for them. The reasons are pretty simple: well-known brands are associated with high quality, performance, experience and are generally recognizable. As a result, Volkswagen Group retains brands like Audi, Bugatti, Lamborghini, Seat, etc; whereas LVMH holding preserves tens of brands that ultimately compete against each other. The reasons for that are pretty obvious: loads of money are invested into creation of a brand and its support. Many consumers have either acquired or simply know from advertisements that ATI produces graphics cards, whereas Moët et Chandon makes champagne; hence, LVMH will hardly start selling something like "Louis Vuitton Moët Hennesy Brut Imprerial". It is noteworthy that when Rackable acquired SGI in 2009, it actually decided to use SGI name instead of its own due to the value of the brand.

It should be noted that with the dawn of the accelerated processing unit (APU) era does make sense for AMD to sell those chips under one single trademark since AMD E350 with ATI Radeon HD 6310 graphics core does  not sound easy for average consumers. But does AMD Vision based on AMD E350 with Radeon HD 6310 graphics sound easy?

But to make the matters worse, the first AMD Radeon HD 6800- and 6900-series graphics adapters failed to truly impress the enthusiast and consumer community. Firstly, the  AMD Radeon HD 6870 could barely beat the previous-generation ATI Radeon HD 5850 and in spite of the fact that the model 6870 is less expensive, without a "wow" factor customers may clearly start to look at Nvidia-branded solutions, which are known for high performance and carry-on additional functionality. Secondly, the AMD Radeon HD 6970 is somewhat faster than the ATI Radeon HD 5870, but is clearly slower than the ATI Radeon HD 5970 (customers don't care about the number of chips onboard, do they?), which again eliminates any "halo" effect and in combination with a less known brand may affect business performance of AMD's graphics business unit.

It should be noted that the rather low performance of AMD Radeon HD 6800 and 6900 was not a result of poor execution or anything within a company, but was a consequence of canning of 32nm fabrication process by Taiwan Semiconductor Manufacturing Computer. As a result, both AMD and Nvidia had to design new breeds of graphics chips for 40nm process technology, something that dramatically reduced their abilities to drive performance upwards and also innovate in terms of features.

AMD's Q4 of FY2010 ended on the 25th of December, 2010, and the company will report its financial results in the second half of January, 2011. From those results it will be possible to make educated guesses whether the drop of ATI brand was a good idea or not amid the known performance issues of the new-generation products.

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