Nvidia: "ATI's thrown in the towel"
- Thread starter Miksu
- Start date
- Status
Jen-Hsun Huang echoed the sentiment to Businessweek, and went a little further:
AMD + ATI: Imperfect Together?
Seems there may be a full interview later (?)
AMD + ATI: Imperfect Together?
Seems there may be a full interview later (?)
I think Nvidia is jumping the gun by a long shot. They could lose out on this deal in the chipset market. AMD could get sick of competing with them on their own platform and drive royalty payments sky high, Intel could do the same, leaving Nvidia's chipset division in the dark.
AMD could also make it difficult for Nvidia graphics cards to run on their platform. Intel doesnt care that much but a lot of gamers, or people who buy discrete boards, go AMD.
Now I did hear a conspiracy theory Nvidia hinted at AMD to buy ATI to eliminate the competition. If AMD plans on slowing progress in the GPU arena then Nvidia wins by default.
Only time will tell of course.
AMD could also make it difficult for Nvidia graphics cards to run on their platform. Intel doesnt care that much but a lot of gamers, or people who buy discrete boards, go AMD.
Now I did hear a conspiracy theory Nvidia hinted at AMD to buy ATI to eliminate the competition. If AMD plans on slowing progress in the GPU arena then Nvidia wins by default.
Only time will tell of course.
Rahul Sood says "Hi". 
In fact he's gone on to the other extreme end saying:
"AMD and ATi just planted the seeds to a Tsunami that will most certainly change the landscape of the market."
"ATi + AMD = a go big strategy that will shake the very foundation of our industry."
In fact he's gone on to the other extreme end saying:
"AMD and ATi just planted the seeds to a Tsunami that will most certainly change the landscape of the market."
"ATi + AMD = a go big strategy that will shake the very foundation of our industry."
The idea that Intel would somehow up and decide to kick ATI out of the pciex slot with some sort of poison pill in their chipsets is pretty far-fetched, I think!
It is nice to see NV beating their chest a bit tho; I'd really be worried for them if they weren't, as it would be so out of character.
On the debt bit, my understanding is AMD is borrowing roughly $3-3.5B to make this deal go (this is in the powerpoints at amd.com). It will increase their debt load temporarily higher than they'd like, but less high than it was a few years ago. They sounded pretty confident about getting it back to their corporate target range for that relatively quickly. Time will tell, of course. There was absolutely no hint (in fact, there was an explicit denial) that the deal would impact their preplanned cap-ex going foward, which is a pretty good sign they don't see it as problematical.
I suppose Intel is the interesting one for keeping their heads down so far. Have they said anything in public? "Neiner, neiner we don't care! We'll kick your butts anyway!" or the like?
This big a change, it should surprise no one that there is going to be some posturing going on in some corners. I guess it's a stylistic difference that AMD/ATI went out of their way on multiple opportunities to be inclusive in their language, and NV. . . err, stayed in their character as well.
It is nice to see NV beating their chest a bit tho; I'd really be worried for them if they weren't, as it would be so out of character.
On the debt bit, my understanding is AMD is borrowing roughly $3-3.5B to make this deal go (this is in the powerpoints at amd.com). It will increase their debt load temporarily higher than they'd like, but less high than it was a few years ago. They sounded pretty confident about getting it back to their corporate target range for that relatively quickly. Time will tell, of course. There was absolutely no hint (in fact, there was an explicit denial) that the deal would impact their preplanned cap-ex going foward, which is a pretty good sign they don't see it as problematical.
I suppose Intel is the interesting one for keeping their heads down so far. Have they said anything in public? "Neiner, neiner we don't care! We'll kick your butts anyway!" or the like?
This big a change, it should surprise no one that there is going to be some posturing going on in some corners. I guess it's a stylistic difference that AMD/ATI went out of their way on multiple opportunities to be inclusive in their language, and NV. . . err, stayed in their character as well.
DudeMiester
Regular
I'm absolutely sure that AMD will continue to support the Intel platform via ATI, if only because Intel would never do the same. On the other hand, AMD has already said they are committed to supporting the Intel platform, chipset and GPU wise, so long as Intel lets them. Knowing Intel, they won't. They may very well lock ATI GPUs out of their platforms and they have already denied ATI their FSB liscence.
Now obviously if Intel doesn't lock them out AMD will have sales and make money, but it may be harder to see the advantage if AMD is locked out. However, all one has to do is realise the incredible marketing advantage! "Intel denies you choice. AMD give you freedom!" This is a marketing line that will work with consumers, but is even better on the OEMs where the real money is. No OEM wants to be locked in to a vendor as it reduces their ability to adapt, choose and ultimately survive. Furthermore, a lockout would play into AMD's anti-trust lawsuit fabulously, which would then stongly feed back into the marketing effort. An Intel lockout is the perfect marketing tool for AMD. Knowing Intel, they are arrogent enough to fall into this trap. I mean just think of it, what says more about your company then the line, "We're so good we support our competitors products better then they do"?
No matter what happens it's a win-win scenario for AMD-ATI, and that's why they made the deal.
Now obviously if Intel doesn't lock them out AMD will have sales and make money, but it may be harder to see the advantage if AMD is locked out. However, all one has to do is realise the incredible marketing advantage! "Intel denies you choice. AMD give you freedom!" This is a marketing line that will work with consumers, but is even better on the OEMs where the real money is. No OEM wants to be locked in to a vendor as it reduces their ability to adapt, choose and ultimately survive. Furthermore, a lockout would play into AMD's anti-trust lawsuit fabulously, which would then stongly feed back into the marketing effort. An Intel lockout is the perfect marketing tool for AMD. Knowing Intel, they are arrogent enough to fall into this trap. I mean just think of it, what says more about your company then the line, "We're so good we support our competitors products better then they do"?
No matter what happens it's a win-win scenario for AMD-ATI, and that's why they made the deal.
Last edited by a moderator:
Looked at the powerpoint again:
So the new debt is lower than I thought. And if I'm interpreting "combined balance sheets" correctly, then the purchase price is actually crediting ATI's not-insubstantial current cash and short-term assets position. So AMD takes that money (somewhere in the neighborhood of $600M or so, last I checked, for cash and short term investments) out of ATI's pocket and gives it to ATI's stockholders as part of the purchase price.
So the new debt is lower than I thought. And if I'm interpreting "combined balance sheets" correctly, then the purchase price is actually crediting ATI's not-insubstantial current cash and short-term assets position. So AMD takes that money (somewhere in the neighborhood of $600M or so, last I checked, for cash and short term investments) out of ATI's pocket and gives it to ATI's stockholders as part of the purchase price.
Maintank said:
As far as chipsets go, AMD would be foolish to want nVidia out of the chipset market.
nVidia has already established total dominance in this area, as shown by CPU-Z statistics for K8 processors:
http://valid.x86-secret.com/stats.php?type=3
nForce 4 - 65.2%
nForce 3 - 19.9%
ATi Express - 5.2%
Do you honestly think AMD, whose core business is selling CPUs, is going to alienate the company that builds the chipset for 85% of their customers? And force them to buy the chipsets chosen by 5%?
I realize this is only a sample of 12,000 or so gamers, but I think we would find nVidia dominates AMD chipsets across the board.
I don't know that a company like AMD who has historically maintained a marketshare in the high teens is in a position to potentially alienate customers by forcing some "you'll by ATI motherboards or you won't buy AMD chips" mandate down their throats.
When you look at the WHOLE picture, it's pretty clear people want nVidia products and other companies might cost themselves a good deal of money trying to "freeze nVidia out":
http://biz.yahoo.com/prnews/060511/sfth065.html?.v=47
AMD would have to be NUTS to "AMD could also make it difficult for Nvidia graphics cards to run on their platform"- it would be like throwing away 83% of their high end customers and 60% of all combined.
At a time when Intel just introduced a better cpu at highly competitve prices?
Don't think so.
MY guess is AMD had ONE thought in mind with this acquisition- present OEMs with a unified package like their competitor does, and hopefully gain a little marketshare.
Last edited by a moderator:
Vista will force that, sooner or later. My guess is sooner. Intel doesn't want cut out of any market, even if the market is just integrated graphics cards._xxx_ said:If Intel can build even a solid midrange gfx-card this or next year, I'm in for tar and feathers...
If Intel is really planning to combine the CPU/GPU in the near future, AMD had to step up and counter. Instead of starting from scratch, it was a better option to buy out one of the existing IHV's. It didn't work out with nvidia so they went with Ati.
It'll be a few years (2-3) before we see the impact of all this. People are expecting some dramratic changes over night and that simply does not happen. Ati has a customer base and a following which AMD will simply not want to hand over to nvidia. That's what people would refer to as "stupid." Instead they'll let the Ati roadmap continue as is while they combine their engineering/r&d to properly counter Intel when they make the big transition.
From a CPU IHV standpoint, they really have to starting looking at GPU's now for profit. Having 8+ core cpu's won't mean much as software will not scale that quickly. This means they have to find a new way to get buyers to cycle out their CPU's. Look at the current trend. People go through GPU's all the time since the benefits are obvious but CPU scaling is pitiful for gaming. Gamers are the ones who buy these high end CPU's that have the biggest margins in them. Gone are the "CPU is king" days. You can now get away with a mid range CPU and spend the rest of the money on a graphics card. Just look around and you'll see that most gamers have a gpu that is more expensive than the CPU in their system.
Neither CPU manufacturer is oblivious to this fact. Infact, as they see the forward trend, GPU's will continue to have more appeal (HTPC's, Vista, Gaming) so it is critical that they find a way to integrate the GPU at a respectable level into their CPU. Imagine if tomorrow you could go out and buy a new intel/amd cpu for $700 that has the CPU power of a Conroe and the GPU power of a x1800xt. It'd be a smash hit. Now imagine the entire lineup being as such and it'd put the GPU IHV's in a world of hurt. IF Intel and AMD are headed in that route, I expect nvidia to be merged/bought out at some point in the future as this gets closer to reality. Right now, nvidia is better off maintaining their sole position for the next few years and maximizing profits.
It'll be a few years (2-3) before we see the impact of all this. People are expecting some dramratic changes over night and that simply does not happen. Ati has a customer base and a following which AMD will simply not want to hand over to nvidia. That's what people would refer to as "stupid." Instead they'll let the Ati roadmap continue as is while they combine their engineering/r&d to properly counter Intel when they make the big transition.
From a CPU IHV standpoint, they really have to starting looking at GPU's now for profit. Having 8+ core cpu's won't mean much as software will not scale that quickly. This means they have to find a new way to get buyers to cycle out their CPU's. Look at the current trend. People go through GPU's all the time since the benefits are obvious but CPU scaling is pitiful for gaming. Gamers are the ones who buy these high end CPU's that have the biggest margins in them. Gone are the "CPU is king" days. You can now get away with a mid range CPU and spend the rest of the money on a graphics card. Just look around and you'll see that most gamers have a gpu that is more expensive than the CPU in their system.
Neither CPU manufacturer is oblivious to this fact. Infact, as they see the forward trend, GPU's will continue to have more appeal (HTPC's, Vista, Gaming) so it is critical that they find a way to integrate the GPU at a respectable level into their CPU. Imagine if tomorrow you could go out and buy a new intel/amd cpu for $700 that has the CPU power of a Conroe and the GPU power of a x1800xt. It'd be a smash hit. Now imagine the entire lineup being as such and it'd put the GPU IHV's in a world of hurt. IF Intel and AMD are headed in that route, I expect nvidia to be merged/bought out at some point in the future as this gets closer to reality. Right now, nvidia is better off maintaining their sole position for the next few years and maximizing profits.
Mid-range DX10 card is well above a "solid mid-range gfx-card this year."trinibwoy said:
They need DX9 hardware support and tolerably good performance at it just for the OS.
Well, I think there are a few possible paths forward for NV. It seems to me that this development encourages them along a line they like anyway --that of trying to be the high-end, value-add, high-margins guy. So what if over time they lose most of the bottom 1/2 of the AMD market (which likely will be greatly bigger as AMD is better able to bundle with Dell/Gateway, etc)? And the bottom 1/2 of the notebook market? That's never been where their heart is anyway, down in the bottom. They've done it from time to time when asked to help out a partner like AMD, or if an opportunity appears, but their heart is never really in it.
Now, continuing to expand on the consumer side with Sony, Apple, et al. . . that would be a much more likely alternative in my mind. I don't expect NV to exit the PC market by any means, but I also don't see them sweating the low-end of that market becoming harder for them to compete in --it's just not them to do so.
Now, continuing to expand on the consumer side with Sony, Apple, et al. . . that would be a much more likely alternative in my mind. I don't expect NV to exit the PC market by any means, but I also don't see them sweating the low-end of that market becoming harder for them to compete in --it's just not them to do so.
- Status
Similar threads
