Quanta Sues AMD Over "Faulty" Chips

The world's largest contract maker of notebook computers, Quanta Computer Incorporated, has filed a lawsuit against Advanced Micro Devices Incorporated (AMD) for what Quanta is calling a breach of contract. Quanta is accusing AMD of selling the company defective products and thus seeks compensation.

AMD and its ATI Technologies Incorporated unit sold chips to Quanta that did not meet the company's tolerances and were unfit for particular purposes, the company noted in a federal court filing in San Jose, California. The chips Quanta purchased were used in notebooks Quanta manufactured for NEC which caused the computers to malfunction and crash according to the court filing.

In a statement from Quanta that is found in the court documents says, "Quanta has suffered significant injury to prospective revenue and profits." Quanta is seeking a trial by jury as well as damages for the faulty chips. AMD, which accumulates over $6 billion in annual revenue, is the second largest maker of computer processors, bested only by Intel, which has a staggering $50 billion annual revenue.

The lawsuit also claims breach of warranty, negligent misrepresentation, civil fraud and interference with a contract. "AMD disputes the allegations in Quanta's complaint and believes they are without merit," AMD spokesman Michael Silverman said in a statement. "AMD is aware of no other customer reports of the alleged issues with the AMD chip that Quanta used, which AMD no longer sells. In fact, Quanta has itself acknowledged to AMD that it used the identical chip in large volumes in a different computer platform that it manufactured for NEC without such issues."

In addition to NEC, Quanta makes computers on contract for HP, Dell and Acer. The company's shares increased 1.9% in Taipei today before news of this lawsuit went public, and the case has been filed as Quanta v. Advanced Micro Devices, 12-cv-12, U.S. District Court, Northern District of California.

Source: Bloomberg - Quanta Sues AMD Over Allegedly Unsuitable Chips for NEC Notebook Computers

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Will Desktops Ever Make a Comeback?

Laptops are becoming increasingly popular. Personally, I haven't owned a desktop in five years and don't see myself ever going back to being desktop-only household. Nothing beats using my wireless laptop from anywhere in my home. If I'm cooking from a recipe I found online, I just put the computer on my kitchen counter. If I'm sick, tired or just being lazy, I can take the laptop to bed with me. And on nice spring days, I can work outside, on my porch, vs. being tied to my desk and stuck inside all day. Not to mention I can take my computer with me anywhere I go, whether it be a vacation or to a coffee shop with free Wi-Fi.

But it seems as though I'm not alone. Desktop sales are falling and laptop sales on the rise. Does that mean desktops are gone forever? Not according to a few people at AMD and Via.

Patrick Moorehead, a vice president at AMD, told the New York Times he sees the computers reemerging as "small form-factor desktop[s]." Via Vice President Richard Brown is also optimistic, asserting that desktops in the corporate world are not going away anytime soon.

But according to research firm IDC, desktop shipments will decline over the next few years. In the United States, in 2009 alone, desktop shipments were expected to drop 14.2%. In 2010, they will fall another 3.6% and 1.9% in 2011. However, international desktop shipment numbers look a little different. While shipments were expected to decline 12.9% in 2009, they are expected to gradually rise again in the following years: 0.1% in 2010, 1.6% in 2011, 2.0% in 2012 and 0.9% in 2013.

According to Brown, that worldwide increase can be attributed to Asia, "In China and elsewhere, those people have started to desire a real computer when they get home. They want a bigger screen and more power. The desktop offers that."

Even so, laptops and other portable computer shipments are expected to increase at unbelievable, double-digit rates over the next four years, due to the fact that users are becoming increasingly mobile. There's no question notebook computers will continue to dominate the market in the near future but as for the desktop, only time will tell what becomes of it.

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Before you get excited though you should know that this will not double the transfer rate of data for your hard drive. Currently no Hard Drive, even the SSDs, have broke the SATA 2 288.55 MB/s data transfer cab, but some are getting close, the Intel X-25M is currently the highest at 250MB/s.

So why bother you may ask, Seagate commented by saying that usually the SATA cable technology always improves a couple of years in advance of the Hard Drives. Also the new spec also includes greater support for streaming operations in its Native Command Queue, so you can do streaming reads/writes without grinding all the rest of your operations to a halt. Even better news is the SATA 3 cables will be fully compatible with all SATA 2 products and will be out by the end of the year.

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