February 7, 2005 3:02 PM PST

Former Dell exec takes spot on AMD board

Advanced Micro Devices on Monday appointed former Dell executive Mort Topfer to its board of directors, prompting analysts to wonder if the chipmaker is making more of an effort to cozy up to Dell.

Over a span of 10 years, Topfer served in several roles at the Round Rock, Texas, company. He did stints as Dell's vice chairman and also sat on its board of directors. He has been credited with helping build Dell--not only the company but also its current management team, including CEO Kevin Rollins--into a PC powerhouse. The company, which reports its fourth-quarter earnings Thursday, was the world's mentored chairman Michael Dell and to have helped recruit Rollins. Topfer shared the executive suite with the two men for a time before taking a seat on Dell's board.


Photo: Polytechnic
University
Mort Topfer

Dell even named a factory after the former executive. After choosing not be re-elected to the board in 2004, Topfer was replaced by Rollins. Rollins also became Dell's CEO in July 2004.

Despite the fact that he no longer serves on Dell's board, the 68-year-old Topfer--who currently serves as managing director of Castletop Capital, an Austin, Texas, investment firm--is still seen as holding sway at the computer maker. Dell is the only major brand name in the PC business that does not use AMD chips in at least one product line. It is thus a major target for the Sunnyvale, Calif., chipmaker.

Dell executives have had more good things to say about AMD of late. They have praised it as a technology leader for moving standard PC processors to 64-bit addressing and for the speedy development of dual-core PC processors.

"We believe there will come a time when we use AMD products, too," Rollins said during a Boston appearance in November.

But it's unclear when that time will come. Rollins has also said Dell--which considers business computers such as servers, storage systems and services to be its main focus--wasn't seeing overwhelming customer demand for AMD Opteron processor servers.

Because of his unique status, "AMD is probably the one who courted Topfer," said Brooks Gray, an analyst at Technology Business Research. "I'm sure (AMD) will try to use him as leverage to bring Dell on board over time."

Even putting the personal connection aside, Topfer could prove a valuable interpreter for helping AMD better understand Dell's needs, another analyst said.

"Certainly, it gives (AMD) a little bit of a view into Dell, and at least Mort can interpret the signals for (the chipmaker) better," said Roger Kay, an analyst at IDC. "He knows what they're saying" at Dell.

But both analysts agreed that the decision would eventually come down to business and is unlikely to be decided by personal relations--even if Topfer is able to put together a golf foursome with himself, AMD Chief Executive Hector Ruiz, Rollins and Dell.

An AMD spokesman said the chipmaker sought less to tap Topfer's personal relationships than it did his broad experience, which ranges from serving as an executive at Dell and Motorola to dealing with large financial transactions at Castletop.

For AMD, the "sum equals a whole that, for us, is very attractive," the spokesman said.

 

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