Mercury Research on graphics market share

[Mark]

http://www.tomshardware.com/hardnews/20041026_164352.html

According to sources, the report estimates Nvidia's total market share for standalone graphics chips in Q3 of 2004 at 37 percent, down from 50 percent a year earlier. Rival ATI was able profit from this situation, increasing its share in this segment from 45 percent to now 59 percent.

The dramatic loss for Nvidia becomes even more apparent in the prestigious desktop standalone segment. This round of a brutal fight for market shares goes to ATI which was able to ship 55 percent of all standalone desktop graphic ships in the most recent quarter, up from 38 percent in 2003. Nvidia's share in this segment dropped from 58 percent to 42 percent in the same time frame.

now that's a shift

 

[Inane_Dork]

Wow. ATi finally capitalized on nVidia's lack.

An AGP 6600 GT should boost nVidia's market share, assuming it comes out.

 

[Dave Baumann]

I think this is partially as a result of NVIDIA trying to get the FX series out of the market as much as possible. Intel's integrated kinda killed a lot of 5200 sales and now NVIDIA are trying to transition to the 6 series ASAP, however there is always going to be a lull whilst ramping the new hence ATI was able to capitalize on it. Only 10% of ATI's sales came from PCIe in their last Q which indicates that most of their PC graphics revenues were actually from the 9x00 series.

 

[Mark]

More details at X-bit
http://www.xbitlabs.com/news/video/display/20041026150740.html

According to the data, Intel Corp.’s market share in the graphics systems market rose 1% to 39% in the Q3 2004. ATI Technologies’ market share skyrocketed 4% to 27% in the Q3 2004, while its arch-rival’s – NVIDIA Corp.’s – share dropped 8% to 15% from 23% in the third quarter of the year. Intel supplies chipsets that contain integrated graphics cores for mobile and desktop computers, while ATI and NVIDIA concentrate on standalone graphics chips for desktops and laptops.

 

[webmedic]

Oh wow thats worse than i had imagined. They got hit really bad for the fx line fiasco.

 

[Pete]

That's some crazy (delayed) momentuum, but you've got to figure nV will come roaring back in the next Q or two based on the strength and diversity of its 6800 and now 6600 offerings. Heck, I just saw a Gigabyte 6800 with a passive cooler: nifty.

Thank goodness NV4x turned out so well, or else nV would rightfully be very scared with Xbox 2 right around the bend (Jan. launch, AFAIK?). I'm completely in the dark as to how their next-gen/refresh (ATi/nV) parts are shaping up, and when we'll see them. Will ATi continue with SM2b parts to compete with nV's 6800 refresh, or will they step up to SM3?

 

[ChrisRay]

I think this is partially as a result of NVIDIA trying to get the FX series out of the market as much as possible. Intel's integrated kinda killed a lot of 5200 sales and now NVIDIA are trying to transition to the 6 series ASAP, however there is always going to be a lull whilst ramping the new hence ATI was able to capitalize on it. Only 10% of ATI's sales came from PCIe in their last Q which indicates that most of their PC graphics revenues were actually from the 9x00 series.

I wonder how many of those sales were accounted for the 9800 Pro at a 200 Dollar pricetag, which is quite possibly one of the best deals at its time.

Currently there really isnt a better 200 dollar solution still. Not until the 6600GT/X700 line can become more available AGP,

 

[duncan36]

I think next quarter will show a bigger shift towards ATi in most areas, you really have to hunt to find a major OEM that has a Nvidia card.

 

[Evildeus]

http://www.hardware.fr/news/lire/27-10-2004/ 8)

 

[Bouncing Zabaglione Bros.]

That's some crazy (delayed) momentuum, but you've got to figure nV will come roaring back in the next Q or two based on the strength and diversity of its 6800 and now 6600 offerings. Heck, I just saw a Gigabyte 6800 with a passive cooler: nifty.

Nvidia is never going to come "roaring back". After the demise of 3DFX, Nvidia was the only performance gaming solution in town, they had no serious competition, and had a tight grip on the whole graphics card market. Their lack-luster performance over the last few years have given ATI several steps up. There are no longer any Nvidia-exclusive OEMs, and the dominant position and customer mindset Nvidia had is no longer there. ATI have upped their products, mindshare and market, and Nvidia have let them get away with it due to their feeble performance.

If anything, the current lack of OEM wins for NV4x, and the way it's been undercut on power, performance, heat, noise, etc shows that Nvidia are still not competing well. Even the cards Nvidia are making now are hurting Nvidia's bottom line because of the high cost, and Nvidia are being forced to subside the retail price to get market share (hence the upcoming replacement of NV40 with a version that's cheaper to make).

Nvidia doesn't automatically get a free pass to the top of the pile just because a few years back they used to be the only game in town, half of which was because their competitors made serious mistakes (3DFX) or refused to participate in the same markets for many years (ATI).

 

[ChrisRay]

I dont think anyone has expected them to have a "Free" ride to the top. But I definately predict it will even out over the next year, As we have seen, 1 year can have a huge impact upon a company.

It is unlikely that there will be a "Clear" leader but it should look a bit more even next year.

 

[duncan36]

I dont think anyone has expected them to have a "Free" ride to the top. But I definately predict it will even out over the next year, As we have seen, 1 year can have a huge impact upon a company.

It is unlikely that there will be a "Clear" leader but it should look a bit more even next year.

You think the market tendency is towards equality and parity? I think the history of it proves otherwise, there are moments of parity but the majority of the history of GPUs has been dominated by one company or another. Only one thing has remained constant; its better to be the one in the lead than the one trying to play catchup.

 

[ChrisRay]

I dont think anyone has expected them to have a "Free" ride to the top. But I definately predict it will even out over the next year, As we have seen, 1 year can have a huge impact upon a company.

It is unlikely that there will be a "Clear" leader but it should look a bit more even next year.

You think the market tendency is towards equality and parity? I think the history of it proves otherwise, there are moments of parity but the majority of the history of GPUs has been dominated by one company or another. Only one thing has remained constant; its better to be the one in the lead than the one trying to play catchup.

I believe with the current standpoint of the market, I dont expect to see large shifts in the market, especially with 2 companies running neck and neck. The Nvidia lead over ATI, As people have said, Probably wasnt going to last,

ATI changed its company and has become much more aggressive in terms of marketing and going after market share. I find it rather unlikely either side is going to be able to push either out unless there is a very clear advantage.

 

[duncan36]

The Nvidia lead over ATI, As people have said, Probably wasnt going to last,

It would have lasted had Nvidia not arsed up.

ATi has gone from chump to champ in a remarkably short period of time, you baselessly say you expect things to go back to the middle. I'm simply saying that things are just as likely to the other direction aka ATi moving further and further ahead of Nvidia.
Or further the other direction Nvidia pulls a 9700/9800 trump out of nowhere and starts to rise over ATi.

 

[ChrisRay]

The Nvidia lead over ATI, As people have said, Probably wasnt going to last,

It would have lasted had Nvidia not arsed up.

ATi has gone from chump to champ in a remarkably short period of time, you baselessly say you expect things to go back to the middle. I'm simply saying that things are just as likely to the other direction aka ATi moving further and further ahead of Nvidia.
Or further the other direction Nvidia pulls a 9700/9800 trump out of nowhere and starts to rise over ATi.

Well Assuming the FX/r300 fiasco had never occurred, I still believe ATI/Nvidia would bound to even out over time. With the aggressive marketing by ATI, and good retail/OEM availability. ATI would eventually level the playing field.

Without a doubt the FX/r300 year hastened this by a bit. But IMO it was inevitable for ATI to eventually catch up. ATI beforehand, was never as aggressive for going for market share/retail and oem markets as they have been these past 2 years.

 

[Bouncing Zabaglione Bros.]

ATI changed its company and has become much more aggressive in terms of marketing and going after market share. I find it rather unlikely either side is going to be able to push either out unless there is a very clear advantage.

Let me tell you why I think ATI will continue to lead and even dominate the next couple of years: XBox 2. It will become a basis for so much development and even the future direction of DirectX, it can't help but pull ATI's R5x0 products along with it. At the same time Nvidia will continue to dismiss the problem and convince people discrete desktop graphics are no longer their primary buisness.

What we've been seeing the last couple of years (and probably the next couple) is the same pattern that's always occurred. One company gets it's act together and starts ascending, as the previous incumbent grows large and loses it's way. The poor showing of NV3x/4x with OEMs, loss of significant controlling technology in the form of XBox2 and DirectX, the hidden amortalisation costs that would have all but wiped out Nvidia's profits if correctly shown, decline in market share and profit margin, etc should all be ringing loud alarm bells.

 

[ChrisRay]

I think you are placing way too much faith in the Xbox2 being a key decider in the desktop/oem graphic market share. It would definately affect profits, But would be pretty irrelevent to Desktop/OEM marketshare IMO.

 

[duncan36]

But IMO it was inevitable for ATI to eventually catch up.

Of course you'd have predicted this inevitability when ATi was about to go bankrupt from the Gf3/Gf4 onslaught?

 

[Bouncing Zabaglione Bros.]

I think you are placing way too much faith in the Xbox2 being a key decider in the desktop/oem graphic market share. It would definately affect profits, But would be pretty irrelevent to Desktop/OEM marketshare IMO.

Developers will be doing a lot of work for XB2, and they'll be doing it on R500. The translation of that work to R520 is going to be straightforward. It will be R500's capabilities that will decide what and how many games will run, not NV50s, and that goes for Direct X too. It's the same pattern that emerged with Xbox 1 and NV20/25.

And even if you discount the Microsoft/Xbox factor, there are still all those other factors I listed. It's when you take all these things together that Nvidia's future looks shaky if they continue to go the way they have been for the last few years.

 

[ChrisRay]

But IMO it was inevitable for ATI to eventually catch up.

Of course you'd have predicted this inevitability when ATi was about to go bankrupt from the Gf3/Gf4 onslaught?

Nope. But you could have predicted it judging by the huge changes ATI made in the last 2 years during the r300 series, Including not limited too,.

#1. A Top to Bottom product line (Something they didnt have before)
#2. Better marketing,
#3. More aggressive OEM dealings.

Developers will be doing a lot of work for XB2, and they'll be doing it on R500. The translation of that work to R520 is going to be straightforward. It will be R500's capabilities that will decide what and how many games will run, not NV50s, and that goes for Direct X too. It's the same pattern that emerged with Xbox 1 and NV20/25.

And even if you discount the Microsoft/Xbox factor, there are still all those other factors I listed. It's when you take all these things together that Nvidia's future looks shaky if they continue to go the way they have been for the last few years

Neither you or me knows how cards will perform in 2 years. Everything listed here is entirely speculative, There were many cases where PC ports have ran better on ATI hardware (During the r300/NV3x debacle) that were ported from Xbox such as Halo, splinter cell, Dues Ex 2.

OEM contracts, aggressive marketing, Power requirements, marketing deals, Are more likely to have a bearing on the desktop/OEM marketshare than the Xbox2 will. I dont think the Xbox itself had much of an effect on the current market share either. (it did have a bearing on profits) Going by such logic. Nvidia should have been on top these past 2 years. But they really werent.