ATi wasn't their first choice, they wanted Nvidia, and they were in the position to buy them but unfortunalty it didn't happen. ATi was their second choice but it wasn't stupid, not at all. It opens up a whole lot of possibilities for AMD, and Fusion being the biggest. Whilst Nvidia and Intel are squabbling, AMD are hard at work and have been for a while now on what Intel is planning on doing. They are not going to reach the benefits of the AMD purchase now, but later down the road they will. It also gave them another thing they wanted, an entire platform (CPU, chipset, graphics card) that they can market to OEMs. They bought ATi because they were looking ahead to what the future was going to be like, and AMD knew that they would need a graphics division to compete in the future.