AMD decimates staff

After we reported yesterday that AMD was going to cut staff, it seems that the chip designer maker has gone ahead and announced cuts of 10 percent.

In the good old days of the Roman Empire a 10 percent cut was what happened if a Legion behaved badly. There would be a lottery and one in ten legionnaries would be beaten to death by his mates.

While the Romans thought that this made discipline tighter, it seems that AMD wants to us it to make their chips a bit lighter.

The company is laying off about 1,400 people, a bit more than 10 percent of its workforce of 12,000 and the cuts will come from all parts of the company.

AMD announced the layoffs beacause it needs to cut costs in order to push into new markets and stay ahead of rivals.

The new CEO, Rory Read is a bit fixated on producing low power chips and wants to take some of the $200 million it will save from the layoffs and other cost-cutting initiatives and funnel that money into new initiatives.

It seems that his cunning plan is to hire more people after it has finished job cutting in 2012.

The move has surprised a lot of analysts who noted that AMD was doing rather well at the moment and had been having trouble cranking out enough chips to meet demand.

AMD appears to be redeploying people to focus on low-power chips.

AMD expects that the layoffs will be completed by the end of March 2012 and if it follows the Roman tradition, the rest of staff will be forced to live on barley rations instead of wheat.

However in the long term the move does show that AMD is either moving towards competition with ARM in the mobile chip arena or is going to come up with some sort of partnership.