The Top 10 Chip Stories Of 2009

One thing's for sure -- 2009 wasn't a boring year for the chip industry. Between a global economic recession and legal entanglements ensnaring the computer industry's most important chip maker, it's likely many will be happy to see this year in the rear view mirror. Which isn't to say there weren't bright spots, including the successful introduction of Intel's new Nehalem-class chips and AMD's six-core Opterons. And those two chip rvials saved the best for last -- a historic settlement of their bitter legal disputes in November. Let's take a look at all of the chip stories that made headlines in 2009.

Intel and Advanced Micro Devices settled several bitter legal disputes in November, including AMD's agreement to end its pursuit of antitrust claims against its larger rival. The settlement saw Intel pay AMD a whopping $1.25 billion to end claims in Delaware and elsewhere around the world, with Intel also agreeing to modify its business practices -- AMD's claims centered on allegations that Intel used "secret rebates" to pressure computer manufacturers to limit or eliminate their use of AMD chips. Also at stake was a dispute over the two companies' x86 cross license agreement, which the pair wound up extending for another five years.

In the words of Intel CEO Paul Otellini, microprocessor sales "fell off a cliff" following the crash of the stock market last September. Tough economic times and a hefty $1.45 billion antitrust fine from the European Union torpedoed Intel's second fiscal quarter, resulting in the chip giant's first quarterly loss in two decades. A promised lifeline in the form of stimulus spending on IT didn't pan out as quickly as hoped -- at least in the U.S. -- and the evaporation of enterprise IT spending is only just starting to turn around as the year comes to a close.

AMD announced its plans to spin off its manufacturing business last fall, but the deal to free the chip maker of its cost-intensive fabrication plants and create a new, separate entity called Globalfoundries was finalized early this year. The theory goes that a nimbler, less debt-ridden AMD is now able to focus solely on designing and marketing great products, while Globalfoundries is actively looking for customers and broke ground on a new fab in upstate New York earlier in the year.

Intel teased us with its first Nehalem-based products, the Core i7 line of desktop chips, last fall. But the real coming out party for Intel's next-generation microarchitecture was this past spring, when the chip giant unveiled its Xeon 3500 and 5500 series of processors for servers and workstations. Those chips blew away the benchmarks and a who's who of top OEMs had Nehalem-based products ready to go right at the launch.

Netbook sales just kept growing even as much of the rest of the PC market suffered during the economic recession. And nobody benefited as much from the phenomenon as your friendly neighborhood chip giant, as Intel Atom processors found their way into the vast majority of netbooks. And expect much more Atom from Intel -- the company unveiled a new product roadmap cadence just for Atom's System-on-Chip development at this year's Intel Developer Forum.

AMD's achievement in bringing its Istanbul-class of Opteron processors wasn't just in the introduction of the first "native" six-core server chip. AMD also released Istanbul well ahead of schedule, an important accomplishment for a company trying to prove to the market that the delays and missteps that hurt the 2007 rollout of its Barcelona products were a thing of the past. Now AMD's roadmap for 2010 promises more products that are ahead of schedule and Istanbul is powering the Jaguar supercomputer -- the most powerful in the world.

Nvidia has its own cross-licensing issues with Intel that remain unresolved, but that hasn't stopped the graphics chip maker from challenging the microprocessor giant in some very fertile market segments. For starters, Nvidia's Ion platform is a powerful alternative to Intel's own chipsets for netbooks, nettops and other mobile devices. And while Ion still uses Intel's Atom CPU, Nvidia's Tegra hardware for handsets and other consumer electronics gadgets is an ARM processor-based platform. Nvidia scored a big design win with Tegra in the fall, securing a place in Microsoft's Zune HD.

AMD's massive restructuring extended to the way it does business with the channel. Dubbed the Fusion Partner Program, the new channel effort led by AMD channel chief David Kenyon combines the vendor's GPU and CPU partner tracks, simplifying how system builders partner with AMD. Stripping down its marketing message to the core essentials is also something AMD is doing in its retail efforts -- abandoning myriad product stickers and instead basing point-of-sales materials around its three-tiered Vision message.

The supercomputers on the latest Top500 list include more GPUs than ever before, and a big reason for that can be found in Santa Clara, Calif. No, not the chip giant just down the road -- we're talking about Nvidia, which deserves the lion's share of the credit for building an ecosystem of OEMs, system builders and software developers around its CUDA graphics programming architecture. Nvidia's Tesla Preferred Partner program has system builders like AMAX Information Technologies, Colfax International and Penguin Computing singing the graphics chip maker's praises.

An insider trading scandal at Raj Rajaratnam's Galleon Group hedge fund centered largely around the alleged sharing of confidential information about high-tech companies -- including AMD's spin-off of its manufacturing assets, Intel's investment in Clearwire and IBM's proposed takeover of Sun Microsystems. IBM's Robert Moffat and Intel's Rajiv Goel were among those arrested by federal authorities, and it was reported that former AMD CEO Hector Ruiz was a source of inside information to another defendant.