IBM Pays GlobalFoundries to take Microprocessor Business

Interesting times for IBM, having already divested themselves of the x86 business by selling it on to Lenovo they’ve now announced that they’re paying GlobalFoundries $1.5bn to take pretty much that entire side of the business!

IBM (NYSE: IBM) and GLOBALFOUNDRIES today announced that they have signed a Definitive Agreement under which GLOBALFOUNDRIES plans to acquire IBM’s global commercial semiconductor technology business, including intellectual property, world-class technologists and technologies related to IBM Microelectronics, subject to completion of applicable regulatory reviews. GLOBALFOUNDRIES will also become IBM’s exclusive server processor semiconductor technology provider for 22 nanometer (nm), 14nm and 10nm semiconductors for the next 10 years.

It includes IBM’s IP and patents, though IBM will continue to do research for 5 years and GlobalFoundries will get access to that. Now what happens to those researchers (one of whom happens to be a friend of mine) after that isn’t clear.

When I heard the rumours yesterday I was wondering if IBM was aiming to do an ARM and become a fab-less CPU designer but this is much more like exiting the whole processor business altogether. The fact that they seem to be paying GlobalFoundries to take this off their hands also makes it sound pretty bad.

What this all means for their Power CPU is uncertain, and if I was nVidia and Mellanox in the OpenPOWER alliance I would be hoping I’d know about this before joining up!

Update: I’ve spoken to some IBM’ers about this and they assert they’re not leaving the chip business, they are offloading off the fabs and the manufacturing IP to GlobalFoundries but not the chip design side of things. In my opinion, though, it does mean that should they decide to exit the chip business at some point it’ll be easier for them to do so.

3 thoughts on “IBM Pays GlobalFoundries to take Microprocessor Business

  1. Update: I’ve spoken to some IBM’ers about this and they assert they’re not leaving the chip business, they are offloading off the fabs and the manufacturing IP to GlobalFoundries but not the chip design side of things. In my opinion, though, it does mean that should they decide to exit the chip business at some point it’ll be easier for them to do so.

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