Xbox : What should MS do next? *spawn

[Deleted member 11852]

Why? MS buying the graphics arm of AMD doesn't naturally decrease the number of OS providers nor GPU providers unless MS's plan is to stop selling discrete GPUs.

If Microsoft plan to stop selling GPUs that's reduced choice for consumers which will be an issue under EU law (not sure about US or China) and if Microsoft plans to continue selling GPUs will have an advantage over Nvidia because they control also control the API. The only way you could an acquisition approval granted is if it were under similar terms as Google's buyout of Motorola where they had to firewall management and co-operation between the two companies, in which case how does Microsoft thunk they can improve AMD's fortunes?

It doesn't make a lot of sense.

 

[Silent_Buddha]

If Microsoft plan to stop selling GPUs that's reduced choice for consumers which will be an issue under EU law (not sure about US or China) and if Microsoft plans to continue selling GPUs will have an advantage over Nvidia because they control also control the API. The only way you could an acquisition approval granted is if it were under similar terms as Google's buyout of Motorola where they had to firewall management and co-operation between the two companies, in which case how does Microsoft thunk they can improve AMD's fortunes?

It doesn't make a lot of sense.

Nvidia could end up with no competition whether Microsoft buys them and discontinues discrete GPUs or not. I think next year is going to determine whether AMD survives or not. Microsoft has also shown it is far more willing to continue sharing when it comes to the Windows Ecosystem. With their Surface hardware design language, they are encouraging Windows OEMs to copy their design. They value their hardware partners far too much to purposely alienate them. The only reason they released the Surface line of tablets is because none of the OEMs was releasing a premium tablet (not just price and features, but build quality as well). If anything I'd imagine Microsoft would be more free with cross-licensing and IP sharing with Nvidia than they would be with freezing them out.

As for an AMD sale, it's unlikely that the US would allow the sale of AMD's CPU business to a Chinese firm. They already restrict how freely Intel can sell x86 CPUs to the Chinese (albeit mainly in the HPC segment). I suppose a sale of the CPU side minus the x86 license might go through, however. A sale of their GPU division would likely go through, however.

All that said, I don't think Microsoft is a serious pursuer of the AMD business. Unless it was extremely cheap. And even then I'm rather doubtful. I also doubt the shareholders would be too keen on the idea.

Regards,
SB

 

[fehu]

The next year is any year the decisive one.
Is like ubuntu, is from 2006 that next year will be the linux's year.

 

[dobwal]

If Microsoft plan to stop selling GPUs that's reduced choice for consumers which will be an issue under EU law (not sure about US or China) and if Microsoft plans to continue selling GPUs will have an advantage over Nvidia because they control also control the API. The only way you could an acquisition approval granted is if it were under similar terms as Google's buyout of Motorola where they had to firewall management and co-operation between the two companies, in which case how does Microsoft thunk they can improve AMD's fortunes?

It doesn't make a lot of sense.

Google's purchase of Motorola is a different circumstance.

Google's purchase was mostly motivated by Motorola's patent portfolio and the purchase came at a time where patent lawsuits were prevalent in the mobile space. Antitrust authorities worried about the patent war's effects on innovation within the market which is the reason the purchase was placed under so much scrunity. Motorola while being owned by Google was censured by the EU for trying to unfairly use its patent portfolio and was basically the type of act that antitrust authorities initially feared.

There was nothing to stop Google from investing in a strategy to leverage its ownership of Motorola to make it a bigger player in the hardware mobile market other than Google not wanting to upset its hardware partners or venture outside its primary strategy of using others to produce the hardware that runs its software.

The GPU market is ruled by Nvidia while AMD is struggling and on the verge of collapsing. MS coming in and investing in the space has a chance of changing the market dynamics and increasing competition in the space. There is no need to firewall the two businesses.

 

[Silent_Buddha]

The next year is any year the decisive one.
Is like ubuntu, is from 2006 that next year will be the linux's year.

It's a little different now. AMD is having a harder time trying to find funding in order to maintain operating expenses. I like their graphics products still, but they haven't been competitive in the CPU market for a very very long time now. Their graphics products are still good, but they aren't iterating as fast as Nvidia are. They need to do something in 2016 to show investors and creditors that they are still a risk worth investing money into.

Regards,
SB

 

[Deleted member 11852]

Nvidia could end up with no competition whether Microsoft buys them and discontinues discrete GPUs or not. I think next year is going to determine whether AMD survives or not.

I think you're probably right about AMD viability but I disagree on the lack of competition. As gamers we tend to look at powerful graphics cards but actually PCs with lower end parts far outnumber the mid/high-end GPU parts and here Intel are driving Nvidia out of the market. Their 'HD' line are prevalent whereas before you'd see a 8400, 9400 or whatever the current equivalent is. You can also argue that AMD leaving the market may allow a third party into the party although god knows who that may be.

I remember when the 2D market was dominated by Matrox and S3 and during the transition to 3D a plucky young upstart called nVidia, make up mostly of ex-Silicon Graphics folks, blew into the PC space. My first PC came with a Riva 128. A what you may ask! New technologies, or even just new approaches to technological problems, can hugely disrupt and existing market and the thing about having a new technology is you have no legacy support problems to hold you back.

Google's purchase of Motorola is a different circumstance.

Google's purchase was mostly motivated by Motorola's patent portfolio and the purchase came at a time where patent lawsuits were prevalent in the mobile space. Antitrust authorities worried about the patent war's effects on innovation within the market which is the reason the purchase was placed under so much scrunity. Motorola while being owned by Google was censured by the EU for trying to unfairly use its patent portfolio and was basically the type of act that antitrust authorities initially feared.

If you read the conditions that were publicly released by three regulators, it was not about patents it was to do with preserving a fair market in Android handsets. This is because Google have an defacto monopoly in the mobile operating system market. It sucks to be successful in terms of market share - ideally you want to be the Apple of a market. Small market share (less user, less support costs) so no monopoly issues but the largest profits.

 

[dobwal]

If you read the conditions that were publicly released by three regulators, it was not about patents it was to do with preserving a fair market in Android handsets. This is because Google have an defacto monopoly in the mobile operating system market. It sucks to be successful in terms of market share - ideally you want to be the Apple of a market. Small market share (less user, less support costs) so no monopoly issues but the largest profits.

This is from your link.

The takeover will be Google's largest ever. The expressed reason for acquiring MMI is its 17,000-strong patent portfolio, many of them relating to mobile phones, so that Google can fight back in multinational lawsuits from companies including Apple and Microsoft relating to Android devices.

That has led to concerns among some rival Android makers that it will compete directly – which Google has aimed to assuage by insisting that it will effectively run it at arms' length.

It was easy for Google to agree that that Android would remain free for the next five years or that it run the hardware company at arm's length. It was never Google's intention to Apple-ize Android. It wanted the patents and it was the patents that worried EU and US antitrust authorities. China was more worried its hardware manufacturers as keeping android free makes procuring or developing a mobile OS cheap for them.

The patents themselves would allow Google to easily disrupt competition as seeking outrageous fees or locking out competitors using MMI's SEP patents takes a lot less effort and disruption of their business model than locking Android to a lossy manufacturer with a small presence in the market.

http://www.justice.gov/opa/pr/state...ivision-its-decision-close-its-investigations

After a thorough review of the proposed transactions, the Antitrust Division has determined that each acquisition is unlikely to substantially lessen competition and has closed these three investigations. In all of the transactions, the division conducted an in-depth analysis into the potential ability and incentives of the acquiring firms to use the patents they proposed acquiring to foreclose competitors. In particular, the division focused on standard essential patents (SEPs) that Motorola Mobility and Nortel had committed to license to industry participants through their participation in standard-setting organizations (SSOs). The division’s investigations focused on whether the acquiring firms could use these patents to raise rivals’ costs or foreclose competition.

http://www.reuters.com/article/2012/02/14/us-google-motorola-eu-idUSTRE81C1HE20120214

"This merger decision should not and will not mean that we are not concerned by the possibility that, once Google is the owner of this portfolio, Google can abuse these patents, linking some patents with its Android devices. This is our worry," EU Competition Commissioner Joaquin Almunia told reporters in Brussels.

If no one has any major issues with MS manufacturing tabs and labs running Windows, why should they worry about MS selling GPUs enough to nix any attempts to purchase AMD. Any purchase can come with conditions like mandatory Linux or OSX support.

 

[Silent_Buddha]

I remember when the 2D market was dominated by Matrox and S3 and during the transition to 3D a plucky young upstart called nVidia, make up mostly of ex-Silicon Graphics folks, blew into the PC space. My first PC came with a Riva 128. A what you may ask! New technologies, or even just new approaches to technological problems, can hugely disrupt and existing market and the thing about having a new technology is you have no legacy support problems to hold you back.

The barrier for entry is significantly higher than it was back then. It's now far more similar to the CPU industry. For an upstart to come along there needs to be a market changing disruption. For the CPU industry that was mobile smartphone devices which gave ARM an opportunity it would not have had if that hadn't happened. Now ARM CPUs rival and perhaps surpasses (I don't really keep up on CPU stuff that much) Intel in terms of volume if not margins.

Similarly there was a market changing disruption that basically put everyone back at the starting line or near the starting line. The move to consumer affordable 3D accelerated rendering hardware. 2D consumer companies were fumbling around trying to implement it. The established professional 3D hardware companies weren't interested in low margin consumer hardware. That left a big gaping hole for the likes of Rendition, 3DFX, NVidia, and Imagination Technologies.

Intel has spent a LOT of money and a LOT of R&D to get their graphics performance to where it is. Could they make performant GPUs that compete with Nvidia? Perhaps. Could they do it in as cost effective a manner with the same iteration frequency? Now it gets harder.

Imagination Technologies might be able to. But do they have the funding or willingness to take that risk? I'm extremely doubtful on both of those points, assuming they were even interested in entering the discrete graphics market.

Other than those 2, I really don't see it being possible for another player to enter the market.

I suppose if Holographic devices fundamentally change the hardware required to render "holographic" images, that might provide a market disruption of sufficient size to allow things to be reset or partially reset such that a startup might have a chance. But from what I can tell, it's still an extension of existing 3D hardware acceleration.

But as it is, the best chance for continuing competition is still AMD's GPU division. Either by AMD getting things rolling or an outside investor either helping or purchasing it. And even that isn't guaranteed.

Regards,
SB

 

[Deleted member 11852]

This is from your link.

I'm not debating that Google's acquisition of Motorola was motivated by the patents, what I'm saying is that the patent situation was not the issue that concerned the three regulators. Google did not have a valuable portfolio of mobile technlogy patents before the Motorola acquisition - nor arguably did they after given Motorola lost a few more patent cases. You quoted (in bold) the statement relating to patents in your post and this was in recognition to a [then] ongoing EU investigation into alleged SEP patent abuse by Motorola (later upheld by the EU) prior to Google's acquisition.

This is why the only conditions placed on Google were in relation to the Android platform because this is where possible conflict from Google's monopoly lies.

 

[Deleted member 11852]

The barrier for entry is significantly higher than it was back then. It's now far more similar to the CPU industry.

Yes and no. Back then fabrication was a real problem and now it's far less of a barrier to enter the market. Disruption happens with alarming regularity. Sony disrupted the console space, Apple disrupted the music industry then the phone industry then jumpstarted the pretty dead tablet industry, Samsung disrupted the TV industry. Nvidia and AMD are just been trundling along with little competition than each other and AMD's R&D is at a ten year low (which means they are spending less on CPU and GPU than when they were just making CPUs) which may explain why they're trailing in market share for both CPUs (always) and GPUs.

Intel has spent a LOT of money and a LOT of R&D to get their graphics performance to where it is. Could they make performant GPUs that compete with Nvidia? Perhaps. Could they do it in as cost effective a manner with the same iteration frequency? Now it gets harder.

Intel make some very cool stuff that isn't in commercial channels. I doubt high-end graphics are a priority for them, they aiming for the larger and more lucrative high volume low/mid-range market (which they largely already have) and improving their low power chips for mobile devices which is a market they're unlikely to reclaim from ARM anytime soon.

The thing about disruption is nobody sees it coming.

 

[dobwal]

I'm not debating that Google's acquisition of Motorola was motivated by the patents, what I'm saying is that the patent situation was not the issue that concerned the three regulators. Google did not have a valuable portfolio of mobile technlogy patents before the Motorola acquisition - nor arguably did they after given Motorola lost a few more patent cases. You quoted (in bold) the statement relating to patents in your post and this was in recognition to a [then] ongoing EU investigation into alleged SEP patent abuse by Motorola (later upheld by the EU) prior to Google's acquisition.

This is why the only conditions placed on Google were in relation to the Android platform because this is where possible conflict from Google's monopoly lies.

Are you not reading the quotes of the links I posted. They are direct or directly quoted from antitrust authorities that explicitly mention potential patent abuse as a major concern.

MS already operates in the way you claim Google was dissuaded from doing with Motorola. MS Surface business isn't fire walled from MS's main business. MS has a monopoly in the desktop OS space and it directly competes (hardware and software wise) in that space. Buying AMD doesn't change how MS naturally operates in regards to its monopoly. Selling its own gpus is no different than selling its own cloud service, Office suite, tabs\labs and other hardware.

 

[Deleted member 11852]

Are you not reading the quotes of the links I posted. They are direct or directly quoted from antitrust authorities that explicitly mention potential patent abuse as a major concern.

Yes, did you not read my post? That statement was a nod to a [then] ongoing EU investigation into alleged SEP patent abuse by Motorola (which was later upheld) prior to Google's acquisition. What the EU was saying is that being bought by Google doesn't change the nature of the investigation into Motorola or any penalties that may be levied. Bear in mind that Google was also under investigation at the same time. Having one potential monopoly abuser buy a patent abuser does not install confidence, hence "they would keep a sharp eye on the web search giant".

 

[dobwal]

I'm not debating that Google's acquisition of Motorola was motivated by the patents, what I'm saying is that the patent situation was not the issue that concerned the three regulators. Google did not have a valuable portfolio of mobile technlogy patents before the Motorola acquisition - nor arguably did they after given Motorola lost a few more patent cases. You quoted (in bold) the statement relating to patents in your post and this was in recognition to a [then] ongoing EU investigation into alleged SEP patent abuse by Motorola (later upheld by the EU) prior to Google's acquisition.

This is why the only conditions placed on Google were in relation to the Android platform because this is where possible conflict from Google's monopoly lies.

Both of those statement were made after approval was given. The justice quote even states the patent issue was the focus of the investigation. EU mentions locking the patents to "android" devices, which is an action that would be perpetuated by Google not Motorola.

What I haven't come across are quotes that fear of google using Motorola to corner the Android market by some method of selling more devices than anyone else, was the ultimate motivator for the investigation.

 

[Deleted member 11852]

Both of those statement were made after approval was given. The justice quote even states the patent issue was the focus of the investigation.

Last post because this is O/T. The EU investigation was ongoing and was without prejudice. Were the EU that concerned about Google becoming a SEP patent abuser (like Motorola was found to be) in addition to alleged monopoly abuser then they could have pended the acquisition decision until after the two investigations had concluded. But the EU were not concerned with the patents and only with ensuring Google did not dump the entire Android market into the shitter.

I can only say again, none of the acquisition conditions relate to the use or licensing of patents, only preserving the continuing freedom of the Android platform.

 

[Silent_Buddha]

Yes and no. Back then fabrication was a real problem and now it's far less of a barrier to enter the market. Disruption happens with alarming regularity. Sony disrupted the console space, Apple disrupted the music industry then the phone industry then jumpstarted the pretty dead tablet industry, Samsung disrupted the TV industry. Nvidia and AMD are just been trundling along with little competition than each other and AMD's R&D is at a ten year low (which means they are spending less on CPU and GPU than when they were just making CPUs) which may explain why they're trailing in market share for both CPUs (always) and GPUs.

Sure and in each of those the market disruption wasn't caused by them, but them taking advantage of a paradigm shift in the market.

High capacity optical storage of games was at the point of changing the industry. It was already in the process of adoption in PCs. Consoles were already made that had it (like the Philips CD-I 2 years prior to the PSX) but none were marketed or supported well (The CD-I for example had mixed messages being presented to the consumer) and couldn't attract serious game developers. Sony saw the market disruption like other companies and first went to Nintendo which didn't go through, and then took the plunge and did it themselves. With sufficient marketing and cash to lure and/or outright purchase franchises for the fledgling console. But it was also something they were already deeply entrenched in. Consumer electronics and optical storage (CD). Heck, the Turbographix-CD was released in 1988 as a presage to the potential paradigm shift, but they couldn't market it worth beans (much like Windows Tablets in the early 2000's).

Samsung didn't really disrupt the TV industry. Unless you consider ATI (a former 2D powerhouse) upsetting the graphics industry by producing the Radeon 9700 pro. But in either case they were already part of the industry. Samsung having made TVs from the 1960's and ATI having been in the graphics industry since the 1980s. It's just that in the Western countries Samsung was relatively unknown until their cheap budget priced LCDs entered the market. Not nearly the same as coming into the market from nowhere like NVidia.

Apple took advantage of the market disruption that .MP3 represented. Digital Music. They didn't cause the market disruption. Again, a place where everyone was basically reset to 0 or near 0. While the established music player maker's were either ignoring this format or not finding ways to properly market it, it was a perfect opportunity for an upstart to jump in. Cost to manufacture was low. All you had to do was present it in an attractive package with navigation that was easy to use with marketing that was very good. Something Apple had experience in, but could not take proper advantage of when faced with the Wintel behemoth.

Back to the GPU market. There is no market disruption for a upstart to take advantage of. There's a behemoth in the room in Nvidia (like Windows for OS or Intel for CPUs). You can't just make something different (3D accelerated rendering) because nothing is changing there like there was with the transition from 2D -> 3D. Or the transition from CD-players to MP3/Digital music players. Or the transition from CRT -> LCD.

There isn't even a situation where an upstart like Vizio can enter the market and become a major player like it did with LCD TVs. LCD TVs were on the verge of becoming a commodity market when they entered. Panel makers (Samsung, LG, Sharp, etc.) were selling A-/B grade panels for cheap rather than writing them off. There is no similar opportunity here.

And lets not even get into the IP and Patent minefield that exists with mature and well established market entities in a technology dominated market. When Nvidia entered there wasn't much there with regards to consumer level 3D rendering hardware. Now, it would be extremely difficult make a clean design. As an upstart you likely also won't be getting much in the way of cross-licensing. Anything you license would likely also be at a high cost in addition to having to design something that can compete in a very heavily contested market. It isn't like Nvidia are ignoring a particular market segment as Intel was with low power CPUs.

Hypothetically speaking, if Holographic rendering greatly changed how graphics acceleration could be handled, that would provide an upstart a opening to develop its own IP portfolio. Which then gives it leverage in negotiations with established players if they need to license/cross-license in order to implement something. But I don't see that happening.

Also, who is going to pony up the funds to enter into a market where you'll need a large legal budget. A large R&D budget (starting off from scratch, AMD and Nvidia spend relatively less as they are interating on past hardware designs with minor and sometimes not so minor changes). A very large marketing budget (to compete with NVidia's marketing). For a market where it's difficult for even the market leader to make large profits (although that's gotten better now that AMD aren't as competitive as they were in the past).

So I think at least 1 of 2 things needs to happen for a completely new player to enter the arena.

1. The GPU market must become a commodity market or close to a commodity market. And the existing players start reselling their GPUs to other companies for other companies to rebrand them as their own. This isn't likely to happen.
2. The GPU market shifts in such a way that it completely changes how consumer GPUs are designed. Similar to the 2D -> 3D shift. I don't see anything on the horizon with the potential to do this. Ray-traced rendering maybe?

Other than that the best way is going to be to aquire an existing GPU maker and its IP and patent portfolio. And then have enough funding to establish a serious contender. And that's even assuming the GPU maker has IP and patents relevant to the current market and the ability to make competitive products with that IP and patents. Something that couldn't be said with all the failed former 3D accelerated graphics companies (like Rendition or 3DLabs) when they were aquired.

Hence why I only brought up Intel and Imagination in addition to AMD previously.

Regards,
SB

 

[Rangers]

Are you not reading the quotes of the links I posted. They are direct or directly quoted from antitrust authorities that explicitly mention potential patent abuse as a major concern.

MS already operates in the way you claim Google was dissuaded from doing with Motorola. MS Surface business isn't fire walled from MS's main business. MS has a monopoly in the desktop OS space and it directly competes (hardware and software wise) in that space. Buying AMD doesn't change how MS naturally operates in regards to its monopoly. Selling its own gpus is no different than selling its own cloud service, Office suite, tabs\labs and other hardware.

I think it's pretty hard to argue MS has any real monopoly these days. It's like when regulators (wrongly IMO) blocked ATT from buying TMobile. It accomplished nothing, and the idea that's there's no competition in telecom is crazy, with the advent of the internet pretty much all there is is competition! You can talk over wires 5 million ways til sunday.

As we all know already MOST people are accessing the net through a mobile device not a PC, so even if MS had no competition in the shrinking desktop space I'd argue they're not a realistic monopoly. But then they have healthy competitors like Chrome OS and Apple in that space as well. Chromebooks are already quite popular (enough that MS had to give windows license for free for any laptop with MSRP under 250 to stem the market share losses in the cheap sector, since Chrome OS is free). The landscape couldn't be more different than it was 20 years ago.

 

[Deleted member 11852]

Sure and in each of those the market disruption wasn't caused by them, but them taking advantage of a paradigm shift in the market.

There was no paradigm shift that benefited Apple, Sony or Samsung over any of their competitors. They made products that appealed to consumers more than the competition. CD was everywhere it wasn't some cornerstone technology that only benefited PlayStation, there was SEGA CD three years before PlayStation even launched.

Samsung didn't really disrupt the TV industry.

Huh? Samsung went from a company that produced cheap and nasty products to a company that focussed on good quality products. The high-end TV market used to be owned by Panasonic, Sony and Toshiba and Samsung hugely disrupted that. It wasn't new technology it was just making more appealing products and selling them at good prices.

Apple took advantage of the market disruption that .MP3 represented. Digital Music. They didn't cause the market disruption.

So the record labels were selling their music digitally before Apple? I don't recall that. That was the disruption, forcing the music industry to sell music to consumers in a way many consumers wanted.

Back to the GPU market. There is no market disruption for a upstart to take advantage of. There's a behemoth in the room in Nvidia (like Windows for OS or Intel for CPUs). You can't just make something different (3D accelerated rendering) because nothing is changing there like there was with the transition from 2D -> 3D. Or the transition from CD-players to MP3/Digital music players. Or the transition from CRT -> LCD.

3D graphics have been predicated on rasterisation for decades now. The 3D market is ripe for disruption. The market is experimenting. Maybe a Larrabee architecture will be viable in the future. Maybe Dreams software rendering will go somewhere interesting. Maybe everything will be procedural in 5 years. Give it long enough your entertainment will probably be streamed because you bandwidth will be crazy high and latency will be virtually nil. You won't need a local GPU at all.

But seriously O/T.

 

[Scott_Arm]

I don't really see why MS needs to get into the CPU/GPU business? To get better margins on their products? Not sure if it's worth the operating costs and R&D expenses.

 

[Deleted member 13524]

I don't really see why MS needs to get into the CPU/GPU business?

They don't need but if they want to, I'd say it's to get dibs on tailor-made hardware.
Like apple buying Intrinsity.

I think it's pretty hard to argue MS has any real monopoly these days.

Lol wut?

 

[Deleted member 11852]

Lol wut?

In addition to Like we dearly need a WTF! button