Today there is news that the ever-shrinking Advanced Micro Devices (AMD)  is once again contemplating a split and a spinoff, though AMD spokeswoman Sarah Youngbauer tells Stacey Higginbotham that, “we have not hired an outside agency to explore spinning-off/splitting the company.”  The reality is that the trends in the industry are working against all the holdovers from the PC era. Intel is doing well in servers but not so much in mobile. GPUs are the hot new thing and perhaps Nvidia’s salvation. AMD’s tactical move to split processors and GPU operations isn’t such a bad idea but that’s not likely to change things much. Because of fierce compeition, it doesn’t seem like servers are really a long term big ticket opportunity..

It is a damn shame to see AMD fall on tough times. They were always a great story. Every new chip breakthrough invigorated interest in the company. For a while their chips powered my home-assembled, constantly upgraded PCs that I used to put together in my NYC East Village apartment. I still remember this beautiful 15-inch gaming laptop — Ferrari logo and seriously fast and powered by AMD. It had great graphics, terrible battery and would warm up a cold apartment. The fans were like two turbochargers. I played Age of Empires on many a few cold winter nights. The computer almost always got me in the end, much like Intel got AMD.

From the very day I started covering the semiconductor industry, I have thought of Advanced Micro Devices as an interesting, slightly crazy and yet fun upstart. I can’t remember when it shed its “perennial also ran” status. Its founder and chief executive Jerry Sanders was a colorful man, known for his luxe lifestyle and one-liners that even Aaron Levie can’t match. He was a consummate salesman, a great marketer and started the company with seven colleagues from Fairchild in 1969. And he lacked fiscal discipline and lived larger than his means — which ultimately became the company’s culture and its undoing. It started out strong and had about a dozen great years but the rise of the PC turned it into the bridesmaid, but never the bride. And ever so often the company would come up with a new chip to compete with Chipzilla, a moniker The Register founder Mike Magee had for Intel Corp.

For most of its life, the company was an underdog and relished in that role. It was essentially a second-source supplier to companies that were using Intel’s chip. It has a technology agreement with the giant chip maker and it always wanted to figure out its own path. Intel, especially under the leadership of Andy Grove was so good and dominant and rich that even when AMD seemed to have good products, Intel would muscle its way ahead through sheer financial power. Still, AMD did a lot of interesting things — and in fact pushed the envelope for a few years.

In 1995, AMD acquired a company called NexGen and that sowed the seeds of what would become AMD’s rise to glory. In 1997, the company released K6 chip the slow resurgence started. Then came K7, dubbed Athlon. From 1999, when it released its Athlon line-up of chips to 2005, the company produced great chips and the market responded accordingly. AMD even filed a law-suit against Intel for anticompetitive business practices — the good old days when being a reporter was really a lot of fun and you could read legal documents at leisure.

One has to tip one’s hat to AMD’s engineers. (Many have made their way to Apple by the way.) AMD was first to put memory controllers on the CPU and lead the way on putting more capabilities on the CPU itself. It came up with 64-bit extensions and even Intel licensed their x86-64 technology. It went after the server market with its Opteron processors and carved up nearly 25 percent of the server processor market. It pushed multicore processing technologies hard. However, all these were for naught as the company was spending money on fabs and facilities. Sanders is rumored to have once quipped, “Real men have fabs.”

Sanders’ bombast and a whole lot of other executive suite challenges have kept the company from realizing its true potential. It has been run by many chief executives and none of them could stall the slow-motion tailspin. It was always buying a company (NexGen, ATI Technologies, Alchemy, Geode, SeaMicro) or selling/spinning off its divisions (to Spansion, GlobalFoundries, Qualcomm, Broadcom and others), restructuring or doing something — anything really to find a way ahead. AMD perfected the art of activity without achievement, and allowed Intel to stay dominant.

AMD can blame Intel and the markets for its eventual downfall, but the troubles are its own making. AMD’s long standing problem has been mismanagement and big-spending ways. It was apparent even in the halcyon days — and you could pick up that attitude from the executive. Even as late as 2008, when I simply backed away from writing about chips, the company was in denial about its future. It was becoming a flash memory company with some microprocessor and graphics chip business. It was one big tangled mess, according to Ars Technica which ran a two part series on the company’s troubles — it’s worth a read.

AMD, in many ways is a perfect example of a company that had the right ideas, could find the right technical talent and yet couldn’t execute on its own plans, brought down by hubris. I have seen this many times in Silicon Valley and elsewhere, the most recent being Nokia, which too was a great company with smart people and smarter ideas, but too beholden to an image and carriers.