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NVIDIA says trying to design a GPU for the console wasn't worth the cost

Advanced Micro Devices, Inc. (AMD) has quietly dominated the market for commodity graphics chips and CPUs for console gaming systems, and the latest generation of consoles look to be no exception.  Sony Corp.'s (TYO:6758PS4, to launch this holiday season, will feature an AMD GPU and CPU.  And there's an AMD 550 MHz Radeon "Latte" GPU aboard Nintendo Comp., Ltd.'s (TYO:7974popular Wii U.

So how does NVIDIA Corp. (NVDA), AMD's chief rival in the PC graphics market feel about AMD's dominance of the increasingly PC-like consoles?  Not too bad, apparently.

NVIDIA's Senior Vice President of content and tecnology told Gamespot in a recent interview that his company is essentially letting AMD win.  While he's convinced his firm could be AMD if it tried, he says it just isn't worth it, remarking:

I'm sure there was a negotiation that went on and we came to the conclusion that we didn't want to do the business at the price those guys were willing to pay. Having been through the original Xbox and PS3, we understand the economics of the development and the trade-offs.

If we say, did a console, what other piece of our business would we put on hold to chase after that? In the end, you only have so many engineers and so much capability, and if you're going to go off and do chips for Sony or Microsoft, then that's probably a chip that you're not doing for some other portion of your business.

That statement seems a bit odd -- after all, hegemony of consoles could be a ticket for a financially struggling AMD to effectively sell tens, if not hundreds of millions of chips.

The Wii U packs an AMD GPU (blue: memory; red: stream processors; yellow: texture units).
[Image Source: Chipworks]

But NVIDIA's focus is more directed on the mobile market, where it's looking to leverage pared down versions of its GeForce GPUs beside ARM CPU cores.  NVIDIA has its work cut out for it in that market; it largely lost the last round to Qualcomm, Inc. (QCOM) due to its chips being too power-hungry.  

NVIDIA is focused on its mobile processor war with Qualcomm.

NVIDIA is looking to change later this year with the refresh of Tegra 4 that will include an on-die LTE modem.  Between Tegra and the development of traditional PC GPUs, NVIDIA sounds content to let AMD freely dominate the console market -- or so it says.

Source: GameSpot

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Nvidia didn't have a chance...
By nafhan on 3/15/2013 1:58:30 PM , Rating: 5
...if the rumors are correct and Sony wanted an x86 CPU with an on die GPU from the start. Nvidia wouldn't have been able to provide that, period. So, it's kind of funny to me that they are poo-pooing AMD's win here.

RE: Nvidia didn't have a chance...
By ritualm on 3/15/13, Rating: 0
RE: Nvidia didn't have a chance...
By EnzoFX on 3/15/2013 3:49:39 PM , Rating: 2
So you're backing up this claim it seems like... along side sounding like a "Big Green" fanboy.

RE: Nvidia didn't have a chance...
By TheJian on 3/16/13, Rating: 0
RE: Nvidia didn't have a chance...
By nikon133 on 3/17/2013 10:55:31 PM , Rating: 5
Personally, I'd rather stay with 30 - 40 million consoles a year than going for questionable share of Android's mobile market while being completely out of Apple's and Windows phone/Windows Pro tablet shares. Considering that only company that moves real volumes in Android market, Samsung, prefers to stick with their own hardware, and Nvidia is fighting Qualcomm, TI, - even Intel is pushing their X86 on Android - it doesn't really look like Nvidia has it set in stone on mobile market either.

Even on PC market, considering that majority of units are shipped with integrated Intel GPUs, and big chunk of dedicated solutions are based on entry level (and dirt cheap) Nvidia and AMD solutions... that console market might be healthiest source of income than anything else either Nvidia or AMD have right now.

Yes mobile market is and will grow even further compared to console market, but like I said - there are no guarantees that Nvidia will be overly successful there, nor that fierce competition with other players will let them make as much money there as they could, otherwise.

At the end of the day, Nvidia only does what seems to be common practice nowadays - trying to underestimate competitor's success by downplaying its importance. Not unlike what Apple and HTC are trying to do about Samsung Galaxy S4.

Damage control, nothing else.

RE: Nvidia didn't have a chance...
By FlyTexas on 3/18/2013 2:39:15 AM , Rating: 2
nVidia's biggest problem is the lack of a x86 CPU to pair with their GPUs.

So they are going in another direction trying to get away from Intel as much as they can.

Is there a future in add-on desktop graphics cards? Probably not, give a few more years and the built in GPUs on Intel CPUs will become "good enough" for most people.

Hard cord people will want add-on cards, but their numbers will shrink as Intel's GPUs improve.

Quite frankly, I'm shocked that Intel hasn't purchased nVidia, it made perfect sense after AMD bought ATI.

By FITCamaro on 3/18/2013 8:41:21 AM , Rating: 2
Intel and AMDs integrated GPUs have been "good enough" for average people for years.

The discrete market has always been for hard core gamers and Intel is no where close to being "good enough" for them. Sure Ivy Bridge can play older games at decent resolutions and newer games at 720p with low/mid details. But that isn't going to take away sales from those who would have bought a dedicated GPU to start with.

RE: Nvidia didn't have a chance...
By Bateluer on 3/19/2013 11:32:46 PM , Rating: 2
If you're wanting to play games at anything higher than minimum details settings, you're going to get a PCIe card. Even the HD4600 in the Haswell i7 4770K doesn't deliver playable frame rates in yesterday's games. Not exactly future proof there.

RE: Nvidia didn't have a chance...
By phobo on 3/15/2013 4:31:08 PM , Rating: 3
have to agree with you really.... despite the fanboyism-tone of your post. Just two different companies with two different business strategies and markets.

RE: Nvidia didn't have a chance...
By Sahrin on 3/15/2013 4:32:16 PM , Rating: 2
What's the third gaming console that doesn't use an AMD GPU?

RE: Nvidia didn't have a chance...
By GulWestfale on 3/15/2013 6:39:40 PM , Rating: 4
i think no matter how you see this from a fanboy/financial/engineering perspective, teh truth is this: AMD scored several console design wins, and nvidia scored none.

i'm not a fan of either company (i've owned products from both, and they're both great), but as someone else pointed out, if you want an x86 CPU with on-deie graphics (and why wouldn't you, on-die stuff simplifies mobo design and reduces costs) then AMD was simply the only game in town.

overall i think this a good thing for AMD, as they now have a virtually guaranteed source of income over the next 5+ years. in addition, they will perhaps get some name recognition among a younger generation of gamers, who won't look at AMD-powered PCs as second-rate ones when compared to intel. good job, AMD!

By michael67 on 3/16/2013 8:51:06 PM , Rating: 5
Most of them also forget that the chip that AMD designed for the PS4, will also be converted in to a desktop chip, minus some of the stuff Sony owned/needed for the console.

nVidia could even if they wanted it, never make a APU like that.

So yeah they "let" AMD have the design win, as they could not compete whit AMD, as nVidia had to work whit eider AMD for the CPU parts, like that was gone happen, or Intel, and share a lot of IP with Intel and would just cost more to design, or with IBM, but Cell was something Sony did not want any more.

So AMD won by default, not because nVidia let them win.

RE: Nvidia didn't have a chance...
By CeriseCogburn on 3/18/13, Rating: -1
By michael67 on 3/18/2013 1:23:11 PM , Rating: 3
How ???

AMD gets payed to design these chips.

AMD gets payed royalties for every chip thats get made.

AMD is gone use part of the development of these ships also for the desktop.

How is AMD gone loos money on this deal???

RE: Nvidia didn't have a chance...
By epobirs on 3/16/2013 4:23:45 AM , Rating: 2
Actually, AMD is seeking to grab some market in the tablet field with their ATOM and ARM competitor line. So it isn't for lack of trying.

Supplying the console market isn't a high margin business but it can be a critical cash flow asset to sustain the company while seeking more lucrative products.

And heavy presence in desktop and laptop markets? Compared to AMD? Nvidia does not produce x86/64 CPUs nor are they in the motherboard chip set business anymore. Nvidia has a strong presence in PC GPUs and little else of the PC sector.

RE: Nvidia didn't have a chance...
By Amiga500 on 3/16/2013 5:36:08 AM , Rating: 5
Supplying the console market isn't a high margin business but it can be a critical cash flow asset to sustain the company while seeking more lucrative products.

But it means that the vast majority of games will be coded around AMD's GPU µarchitecture. That will bring benefits in terms of relative efficiency on the PC GPUs.

It effectively completely undercuts Nvidia's "The Way Its Meant To Be Played" program.

By CeriseCogburn on 3/18/2013 10:26:02 AM , Rating: 1

Since the code is HARDWARE run in the consoles, it's entirely different than on desktops, integrated or discrete, so what you say just isn't true.
It offers no advantage whatsoever.

RE: Nvidia didn't have a chance...
By Touche on 3/16/13, Rating: 0
RE: Nvidia didn't have a chance...
By Touche on 3/16/2013 11:37:19 AM , Rating: 1
- significant presence in smartphones/tablets and mobile"

LOL, hmm, not quite. There were some Tegra2 phones out there, but Nvidia is almost irrelevant in the mobile space. How many design wins does Tegra 4 have? One, two?

RE: Nvidia didn't have a chance...
By fredgiblet on 3/16/2013 4:19:44 PM , Rating: 2
Tegra 3 has powered a lot of tablets, including the Nexus 7.

I'll agree that nVidia doesn't have much presence in phones, but in tablets they are a contender.

RE: Nvidia didn't have a chance...
By CeriseCogburn on 3/18/13, Rating: -1
RE: Nvidia didn't have a chance...
By tamalero on 3/18/13, Rating: 0
RE: Nvidia didn't have a chance...
By Da W on 3/16/2013 3:43:42 PM , Rating: 3
Sure selling smartphone chips for 10$ FAR outweight selling CPU+GPU for EVERY GAMING CONSOLE for the next decade!

AMD will have a presence in microsoft's next gen Surface. I don't thnik you can call 200$ android tablets the future. they sell for 200$ because they are worth that much.

And serious game developper will learn to develop for 8 core CPU and GCN gpus. Games will be easily ported to valve steambox using same parameters.

RE: Nvidia didn't have a chance...
By semo on 3/18/2013 3:58:01 AM , Rating: 2
You can count on AMD to not capitalize on that. Marketing has never been one of their strengths.

I’d put a TV ad in every continent that says how AMD powers all current gaming consoles and come up with a slogan that directly mocks NVidia’s.

By piroroadkill on 3/21/2013 5:00:05 AM , Rating: 2
AMD does have a presence in mobile in a sense: Qualcomm bought out their IP. Adreno is based off ATI Imageon and then evolved beyond that which ATI designed at the time.

They made a decision to get out of mobile and sell to Qualcomm. So it was no accident.

RE: Nvidia didn't have a chance...
By someguy123 on 3/15/2013 2:58:42 PM , Rating: 3
That rumor doesn't sound legitimate considering sony's normal game plan would've been to develop a proprietary solution like their past consoles.

AMD's APU most likely won out in cost effectiveness. Jaguar CPU isn't very impressive, though the GPU is pretty good on paper. With that kind of chip they could undercut discrete combinations while still providing acceptable performance. AMD doesn't seem to pull in much profit even from the sheer volume of consoles sold using AMD chips.

By Cheesew1z69 on 3/15/2013 4:46:18 PM , Rating: 2
I think Sony might be seeing that developing their own proprietary hardware isn't always the best or the least expensive. Or I hope...

By Zapp Brannigan on 3/15/2013 5:52:08 PM , Rating: 2
It's more to with the ps3 being a bastard to code, and that most 3rd party games run better on the 360 because developers didn't have the budget to code to the ps3's peculiarities, expecially when they would sell more copies on the 360 anyway.

By having "off the shelf" parts for both the ps4 and the 720, Sony and Microsoft will lessen developer burden, and because the ps4 will, in all likely hood, be superior on paper to the 720, maybe sony can secure 3rd party games which run and look better on their hardware, something they weren't able to do on the ps3.

you are correct about cost effectiveness tho, amd route is gonna be much cheaper then a separate intel/nvidia route, allowing sony to save money, something they really need to do atm.

By Pitbull0669 on 3/16/2013 8:15:20 AM , Rating: 2
I so Agree.. Its like saying Intel LET AMD be the chip of choice in the new market..LOL.. Any one who knows this market knows the AMDs APU is at the TOP of this and Intel and Nvidia CANT compete in that market.AMD knew what they were doing when they bought ATI.Its more obvious now than ever.ITS CALL BIG PAY OFF. Cudos to them and Shame on Nvidia for saying other wise. You don't hear Intel saying crap do you?

Short termism
By DanNeely on 3/15/2013 1:39:33 PM , Rating: 2
Avoiding low margin console sales might be a good choice in the short term. Longer term though I think it's going to erode their position in the PC market if all the next generation consoles end up with an AMD chip in them. Most games are cross platform these days; and if none of the consoles have an nVidia GPU that greatly reduces the relative priority of optimizing for their hardware's quirks becuase on a PC they can just list hardware specs as tier N Radeon, or tier N+1 GeForce.

RE: Short termism
By rocketbuddha on 3/15/2013 1:48:12 PM , Rating: 3
Consoles gives a good foothold in gaming area.
NVIDIA has its CUDA while AMD has its OpenCL. OpenCL is also platform independent and manufacturer independent.

If the various game developers display the same "short termism" as NVIDIA then NVIDIA is toast in the gaming area....

RE: Short termism
By someguy123 on 3/15/2013 7:30:05 PM , Rating: 2
Both parties support OCL and their GPUs work with OCL...nvidia is a partner in OCL development. CUDA just offers its own libraries and extensions.

RE: Short termism
By ritualm on 3/15/13, Rating: 0
RE: Short termism
By HrilL on 3/15/2013 2:55:55 PM , Rating: 2
as for GPGPU. If you're anyone mining bitcoins you then know that using AMD GPU's is a lot more effective. AMD's openCL is easier to program for than CUDA as well. AMD will take the lead in GPGPU soon enough.

RE: Short termism
By tviceman on 3/15/2013 4:34:57 PM , Rating: 2
I generally agree with you, but having the Wii, Gamecube, and Xbox 360 vs. Nvidia just having the PS3 (which was a year after the xbox 360 came) did nothing for AMD's performance & market share in the PC space.

Having ALL the major consoles this time around will likely help more so, but when Valve comes to market with steam box, and if it has an Nvidia GPU, depending on how successful it is may completely negate any advantages AMD may have gained.

As others have pointed out...
By Motoman on 3/15/2013 3:02:30 PM , Rating: 5
...Nvidia can't do it anyway...not when "it" is having a single-part CPU and GPU.

AMD can do that. Intel can do that. Nvidia...can't.

They're like Baghdad Bob:

BDad Bob: We are crushing the American pigs and the desert runs red with their blood!

Press: Umm...they've destroyed all of your forces and have already taken the southern part of Baghdad.

BDad Bob: The southern part? Bah. We didn't want that part anyway.

RE: As others have pointed out...
By Totally on 3/17/2013 1:10:00 AM , Rating: 2
Actually, an Angry Poltician would be more apt.

Reporter(Politician): What did you think of Yesterday's stunning landslide victory?
Politician: I feel good in knowing that I let the competition win.
Reporter:(confused) But, you weren't even in the running?
Politician: ... *Poker Face*

RE: As others have pointed out...
By CeriseCogburn on 3/18/13, Rating: -1
RE: As others have pointed out...
By tamalero on 3/18/2013 12:00:56 PM , Rating: 2
holy crap, how much of a fanboy( or a guerrilla marketing employee) of nvidia you are?

Has AMD's contract with Sony and MS been disclosed?
By nerdye on 3/16/2013 3:01:37 AM , Rating: 3
Will AMD profit for every ps4/720 APU and wii u GPU sold? Or did they sell the chips to them as proprietary? Am I wrong or Microsoft owns the chips in the 360?

By epobirs on 3/16/2013 4:29:23 AM , Rating: 2
AMD likely collects a royalty on every chip set shipped. It may be measured in pennies but that adds up over tens of millions of units.

Also, when the time comes for a dies shrink or any other refinements, this will be done by AMD personnel at a profit. AMD is almost certainly contractually obligated to perform these service but not for free or at a loss. (Unless they screw up badly and and miss delivery date with ensuing penalties.)

Microsoft and Sony will have an ownership position on specific iterations of the chips, and provisions will be included for sourcing them elsewhere but it would require AMD to go under or make demands deemed unreasonable by a judge if it came to litigation. Everybody saw what went wrong with the sourcing arrangement on the original Xbox and nobody want to repeat that.

By FITCamaro on 3/18/2013 8:59:39 AM , Rating: 2
Yes Microsoft owns the GPU in the 360. AMD made nothing off the 360 other than the initial fee to develop the chip.

This is likely to be the case for the next Xbox as well. Remains to be seen with Sony though.

Long memories at nVidia....
By kilkennycat on 3/15/13, Rating: 0
RE: Long memories at nVidia....
By Zapp Brannigan on 3/15/2013 6:16:41 PM , Rating: 3
Yet Nvidia don't profitably innovate in the phone/tablet soc market. They have shove a load of bog standard arm cores together and shove it out early, in an attempt to get quick design wins.

Qualcomm, maybe Samsung and ahem, Apple are the only real innovators in the soc market, they also make substantially more money then nvidia do in that market.

RE: Long memories at nVidia....
By UpSpin on 3/16/2013 8:49:38 AM , Rating: 2
You got something wrong, totally wrong.

As far as I know is the Tegra SoC the only SoC with a fifth low power companion core. No one else has this. But this companion core is a huge power saver and a unique part. nVidia does use their own GPU and produced their own radio chip lately. The only stock part is the A9/A15 core.
Samsung on the other hand uses stock ARM cores, stock GPUs from ARM or PowerVR and uses given configurations from ARM (big.LITTLE). No own innovation or SoC design at all, except in the manufacturing process.
Qualcomm on the other hand fully develops its own SoC, cpu, gpu, radio, ...
Apple started to do the same, yet they still rely on a stock GPU from PowerVR. So identical to nVidia, except that nVidia uses defautl ARM CPUs, Apple uses default PowerVR GPUs.

Nice headline but...
By TacticalTrading on 3/15/2013 2:36:28 PM , Rating: 3
From my distant perspective, I don't think Nvidia can really compete. They don't have an x86 chip to pair with their GPUs & chip-sets. AMD is essentially selling a version of their "vision" product, which is being phased out...

The good news is for the Game makers. It is looking more and more like the gen 4 consoles are going to be very PC like under the hood.
Then again, I am a PC gamer, so my thoughts may be a bit biased & hopeful.

Sour grapes?
By Beta212 on 3/15/2013 5:45:09 PM , Rating: 3
Sounds like Sourgrapes on nvidia's part. But no doubt amd needed it more, and was the only one to provide usable integrated graphics combined with x86. Now... Where are the dozens of design wins for Tegra 4?

RE: Sour grapes?
By CeriseCogburn on 3/18/13, Rating: 0
I'm sure...
By chrnochime on 3/15/2013 2:38:25 PM , Rating: 2
Just from what he wrote at the start of his response it's obvious he doesn't know exactly why they ended up not getting the contracts. Lack of resources due to mobile side? I didn't know it required that many engineers to do at most two generations(next generation and the one after that) of mobile CPU/GPU.

Not sure how much money Broadcom and Qualcomm have, but they are equally good(if not better) at designing ARM cores+side GPU.

By Wererat on 3/15/2013 4:24:35 PM , Rating: 2
"If we say, did a console, what other piece of our business would we put on hold to chase after that?"

For NVidia's design, doing such a bid would necessarily mean putting other business on hold. They have server, discrete graphics, and ARM tablet chips but not x86 CPU/GPU chips.

For AMD's design, Sony's request IS their existing general computing solution or dovetails nicely into it; so they aren't giving up business to pursue the PS4 win. They may even (probably will) carry some of the tech from the PS4 chip design back into the next AMD chip.

(disclaimer: I use AMD CPUs and NVidia discrete GPUs, and hold AMD stock).

Am I...
By Totally on 3/15/2013 9:39:23 PM , Rating: 2
The only one who see how Tegra is shaping up to be a dud, even to the point, where the adoption rate is too low for Nvidia's liking or need the the they're trying to drum up interest with Project Shield. i.e. 'If a platform isn't going to pick this up we'll just make our own for this piece of silicon."

By Beenthere on 3/16/2013 2:46:45 AM , Rating: 2
...that they can't deliver what OE customers are requesting, nor can Intel when it comes to APUs. Thankfully AMD is a year ahead of Intel so consumers are the winners with better performance at a lower price.

By Touche on 3/16/2013 11:39:39 AM , Rating: 2
Their business practices have nothing to do with them being dissed by every console manufacturer. It was their choice, yeah, what a load of BS.

RE: Aha
By CeriseCogburn on 3/18/13, Rating: 0
Sony missed a chance
By ARoyalF on 3/17/2013 10:24:06 PM , Rating: 2
to have a built in toaster in the PS4......

By Arsynic on 3/18/2013 9:25:28 AM , Rating: 2
That's the real story here. AMD provides x86-based SoCs and Nvidia provides ARM-based SoCs. ARM just isn't up to snuff for the task of computationally taxing games that console gamers expect.

By Breakfast Susej on 3/18/2013 3:30:54 PM , Rating: 2
Is like the Kim Jong Un of tech CEO's.

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