After a week of rumors, AMD today announced that it has plans to
purchase graphics card maker ATI and merge the two companies. The
value of the transaction is reported to be in the neighborhood of $5.4 billion (USD).
This marks a significant departure for AMD from its past business practices of
focusing exclusively on building processors.
In addition to the merger deal, AMD announced that it would be
cutting prices on its current processor line by nearly 50% in reaction to
the success of Intel's Core 2 Duo processor.
AMD seems busy right now trying to keep pace with Intel and maybe carve out a
new market for itself.