A Stormy, Warm Weekend

April 13th, 2012 at 11:17 am by under Weather, WTHI Blog

The weekend will be breezy and warm.  Scattered thunderstorms are possible.  Cooler air will move in next week.

A real horse race: thanks to ATI, the graphics chip market is competitive again. (Business Trends).(ATI Technologies RADEON 9700 outpowers Nvidia G4)(Product Announcement)

Electronic Business September 1, 2002 | Roberts, Bill For the first time, ATI Technologies Inc. has a significant advantage in the high-end graphics chip market over its archrival, Nvidia Corp. cavecreekaz.org cave creek az

ATI’s advantage might not last long, but it does signal the return of real competition–missing for years–in the graphics chip marker.

In August, the Markham, Ontario, chip company began to ship its new highend graphics chip, the Radeon 9700, which by all accounts is significantly more powerful than San Jose, CA-based Nvidia’s current top-of-line offering, the GeForce4.

“There have been points in the past where ATI came out with a little bit better chip sooner than Nvidia,” says Peter Glaskowsky, editor in chief of the Microprocessor Report, a newsletter owned by Reed Business Information, the parent company of ELECTRONIC BUSINESS. “But the Radeon 9700 is probably twice as fast as the GeForce4.” That’s good enough to likely cause thousands of users to upgrade. Glaskowsky estimates as many as half a million users–graphics enthusiasts and graphics professionals–upgrade their cards as soon as a significantly better chip hits the market. Another 2 million users routinely upgrade once a year.

Nvidia launched the GeForce4 last winter, which makes it old technology by now. Jr is not expected to launch its next-generation chip until late this year.

Analysts believe ATI has a one- to three-month window of opportunity–which may seem small but is significant. Not only does ATI get bragging tights but margins will be much higher during this period. Plus, early adopters always impact what mainstream users buy later.

“For the first time, ATI will actually have a significant advantage,” says Glaskowsky. “In the past, any advantage was small. Maybe a 15% to 50% performance difference and Nvidia was able to release software drivers that overtook that. Any earlier advantage lasted a few days only.” Overall, analysts say the ATI advantage is great for the market. “We’re probably entering the most competitive graphics market we’ve seen in five years,” says Dean McCarron, president of Mercury Research Inc., Cave Creek, AZ. “Five years ago, there were a lot of companies that would launch products with similar price and performance. That faded away as they all collapsed. Until now, major differences in product timing and performance had more or less gone away.

In recent years, Nvidia established itself as the market leader in PC graphics (see chart). Santa Clara, CA-based Intel Corp. has been second because it entered the integrated graphics chipset niche a few years ago. But Intel was slow to come to market with an integrated chipset for its Pentium 4 chip. As a result, analysts believe Intel is slipping in market share this year. web site cave creek az

McCarron expects Nvidia and ATI will both gain market share in 2002, but ATI will gain more because it offers an integrated chipset for Intel, which Nvidia does nor, and the Radeon 9700 will capture share in the high end.

Even in the sluggish PC market this year, sales are up for both companies but not as much as they had anticipated. ATI is expected to top $1 billion in revenue this year and Nvidia could top $2 billion.

Graphics chip companies used to launch a new generation once a year, shipping in time to end up in devices for the Christmas buying season. Five years ago, Nvidia dramatically changed things, introducing two generations each year by using two overlapping and coordinated development teams. Most chip companies were unable to keep up and went out of business (see ELECTRONIC BUSINESS, “Growing pains,” May 2002, page 64).

ATI, which had one PC graphics development team in Marlboro, MA, secured a much needed second team in 2000 as a result of its merger with ArtX Inc., Palo Alto, CA. Through ArtX, ATI also got the expertise needed to build chipsets for Intel boxes.

“The Radeon 9700 is the first discrete product for the desktop that came out of the ArtX team,” says David Orton, former CEO of ArtX and now ATI’s president and COO. “And this is the first time we’ve been able to leverage the parallel activities of the two development teams in the company.

ATI made its mark with discrete graphics chips for the mobile PC market. Nvidia’s strength has been discrete graphics chips for the desktop market. They compete against each other in both markets, however. Nvidia offers integrated chipsets for machines based on Advanced Micro Devices Inc. microprocessors, while ATI staked a hold on chipsets for Intel.

They both have planted themselves in competing game boxes, too: ATI in Nintento Co. Ltd.’s Game Cube and Nvidia in Microsoft Corp.’s Xbox. And, each company has a strategy beyond PCs and game players. ATI is taking aim at graphics-enabled cell phones and set-top boxes. Nvidia has some defenserelated contracts.

2001 MARKET SHARE IN PAC GRAPHICS CHIPS *

total market = 172.6 million units

Via 9% Nvidia 30% Intel 26% ATI 18% Other 17%

* Includes PC and Macintosh graphics chips and chipsets for desktops and notebooks.

SOURCE: MERCURY RESEARCH INC.

Note: Table made from pie chart Roberts, Bill

Comments are closed.