Toshiba to use AMD chip in laptop PCs

TOKYO (Reuters) - Toshiba Corp. (6502.T) said it would buy
microprocessors from Advanced Micro Devices Inc. (NYSE:AMD - news),
ending its exclusive ties with Intel Corp. (Nasdaq:INTC - news) for the
supply of the brains that run computers, and sending its shares
higher.
on Tuesday it expects to put AMD processors in about 20 percent
of the notebooks it sells in the United States and Europe.
The move follows an announcement last year by Dell Inc.
(Nasdaq:DELL - news), the world's second-largest PC maker that had been
procuring microprocessors only from Intel for more than two
decades, that it would begin using chips from AMD.
Intel is AMD's far larger rival with a market share of
around 80 percent.
"With PCs becoming commodity products, there seems to be a
new way of thinking that competition should be introduced even
in procurement of such core parts like processors as long as
there are no major differences in product specifications,"
Macquarie Securities analyst Yoshihiro Shimada said.
"This could be a message that an era in which Intel took
the lion's share of microprocessor profits as the king of PC
chips is over."
Toshiba plans to put AMD chips in moderate-priced standard
models for individual and corporate clients, Toshiba
spokeswoman Yuko Sugahara said.
The Nikkei business daily reported earlier that prices of
AMD-equipped PCs are expected to sell for up to 10,000 yen
($82) less than comparable models.
Toshiba will install AMD chips in some models to be
released this summer, enabling it to reduce parts-procurement
costs by at least 10 percent, the paper said.
Shares of Toshiba were up 1.0 percent at 906 yen in early
afternoon trade, outperforming the Tokyo stock market's
electrical machinery index (.IELEC.T), which gained 0.37
percent.