This post is part 2 in my Nvidia deathwatch series. The first article can be found here.
Some good news appears to have come across the wires for Nvidia. Rumor has it that Nvidia’s Tegra 2, the company’s tiny system-on-a-chip, has finally found a home in devices from companies including Motorola, HTC, Toshiba and ASUS. What the devices are is not yet exactly clear, but you’d have to be dead drunk not to assume they’re either smartphones, tablets, or something akin to both (ala the Dell Streak).
That’s good for Nvidia, right? Well, sure. But as Nvidia begins to make further inroads into the mobile market it will start to become abundantly clear just how small a fry Nvidia is in this world. As a company producing GPUs for personal computers Nvidia had only one rival (ATI) and it had beaten that rival so senselessly that, had it not been bought by AMD in 2006, ATI likely would not be in existence today.
It is hard to overstate how different the mobile processor market is from the market for GPUs. The GPU market is one that consumers still relate to. If you’re the kind of person who would build or buy a computer specifically for gaming you’re also very likely to be the kind of person who knows about and has a personal interest in the GPUs themselves. Nvidia knows this relationship well and knows how to advertise to potential customers with marketing such as “The Way its Meant to Be Played.” Slogans such as this entice consumers because people who buy video cards care about performance – indeed, its just about the only thing they care about.
In the mobile processor market, however, the performance Nvidia can manage to squeeze from a Tegra SOC is largely irrelevant. As Apple as proven, people who use gadgets care about intuitive feel and ease-of-use more than raw performance. The iPad would of course not be able to offer a smooth experience if its processor wasn’t up to the task, but none bought the iPad because of its processor. Nvidia’s CEO, Jen-Hsun Huang, has been eager to boast about Tegra 2′s performance and has also proudly stated that Nvidia is already hard at work producing Tegra 3. That’s fine – but the consumers buying the gadgets really don’t give a damn.
The people who do give a damn are, of course, the manufacturers that need a system-on-a-chip in their devices in order to be competitive. But landing big contracts is about more than proving the performance of your hardware. Its also about proving that you can work well with your partners – and on that front Nvidia has work to do. The company seems to have a pass-the-buck culture when it comes to accepting blame for failure, has suffered numerous product delays, and has shipped defective product that cost its partners in the laptop world millions of dollars.
None of this, to be frank, is entirely different from the Nvidia that has made GPUs we knew and loved for years. Nvidia’s PR has always felt like an iron curtain, the company’s CEO has never been humble, and the company has shipped lackluster products in the past (i.e. Nvidia FX5200). Yet these problems were excusable because, well, there was only one company providing competition.
But now Nvidia is going up against numerous companies, many of which have more money and more experience than Nvidia. They’re no longer the big fish – indeed, they’re just another shrimp trying to survive.