AMD Sets Up China Subsidiary
In a sign of its growing importance to its parent company,
AMD, the US's second largest maker of CPU chips, has set
up a wholly-owned Chinese subsidiary, AMD China. AMD is
the leading competitor to Intel worldwide.
The new wholly-owned subsidiary allows AMD to conduct
a wider range of operations in China, without having to
specify the areas of business in which it would be involved.
Previously, AMD worked from representative offices in
Beijing, Shanghai and Shenzhen.
AMD President and CEO Hector Ruiz, met with Chinese vice
premier Zeng Peiyan and delivered a speech at China's
leading technology university, Tsinghua University. AMD
has also announced partnerships with two Chinese companies,
BLX IC Design Co. Ltd. and Founder Group. AMD and BLX
have teamed up to open a joint development center for
thin-client reference designs based on AMD's Alchemy and
BLX's Godson-1 processor families. Founder and AMD have
also opened a joint design lab for digital home media
centers based on AMD's Geode and Alchemy processors.
Since China has become the fastest growth market for
computer CPUs, AMD
and Intel have competed to secure partnership agreements
in China. Since Intel is the larger company, and has more
resources, it has raced ahead in building
facilities .
To avoid commitment to one single foreign-owned architecture,
the Chinese government has also pushed development of
the local Dragonball architecture, which runs the open-source
Linux. AMD and Intel products have been largely optimized
to run Windows software, which is the dominant product
in the US market. In the past year, the Chinese market
has put its weight behind Linux
. Because Linux is free, and its source code can be optimized,
it has become very popular with governments around the
world this year. Lately, Intel especially, has touted
how well its products run Linux.
Representative offices are the most basic form of foreign
representation in China, and are not allowed to conduct
any business. Their main business is simply to collect
information about the China market. After the representative
office, the next higher business entity is the joint venture,
which is a business arrangement with a Chinese partner.
Following China's joining WTO in 2001, and the gradual
opening to foreign-owned companies, more companies are
changing their representation from joint ventures to wholly-owned
foreign entities. Wholly-owned foreign entities have the
greatest freedom to make business decisions, and can act
without the hindrance of a Chinese partner, which may
have a different agenda from the foreign partner.
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