Saturday, October 10, 2009

Is Nvidia Effectively Dead?

A bit earlier today I found this story. Obviously being on a site called "Semi Accurate" I'm a little hesitant to believe it outright, but I think many of us PC gamers have seen this coming. In the interest of full disclosure, I am running Nvidia chips in both my boxes. I have felt they put out a descent product ever since I picked up a GeForce 256. That was my 3DFX Voodoo 3 replacement, and it was a beast of a card at the time. Nvidia was also one of the most competent companies when it came to driver support, especially in Linux. The hardware was always pretty damn solid with nary a lockup due to a stock clocked card in my experiences. ATI on the other hand at the time was a finicky beast for me, especially when VIA chipsets were involved.

In recent history however, Nvidia had been getting very low yields with their GPU's. That helps keep prices very high in an industry that fosters already high priced products in the first place. Especially these days where SLI has become the norm for the hardcore system builder. A while back ATI had conceded the high end market to Nvidia to focus on mid level product, and in a time of economic decline, that turned out to be a strong strategy for them. I know they really haven't stuck to mid level performance lately, but I do believe that strategy helped them avoid a possible financial disaster long-term as a company. Meanwhile Nvidia continued headstrong into manufacturing hardcore hardware for the gaming elite. Which, while I consider myself one of these hardware junkies, I realize I am in a great minority, and Nvidia should have as well.

Low yields, high manufacturing costs and a six month product cycle just doesn't seem practical in this bear market. I don't really understand their logic, and perhaps never will. My biggest fear if they indeed do fail, is a stagnant GPU market. Technology will continue to get better as always, but will it be at a snails pace? Competition breeds innovation, and if this indeed comes true, ATI will own the high end market alone.

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