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Storm clouds are gathering as NVIDIA faces a reinvigorated competitor

As the old saying goes, when it rains it pours.  NVIDIA was performing beautifully thanks to aggressive pricing and performance of its 8000 series of graphics cards.  It looked poised to leave competitor AMD (formerly ATI) in the dust.  However, the latest round in graphics war has marked a dramatic turnaround with AMD's 4850 and 4870 outperforming NVIDIA's offerings at a lower price

While NVIDIA still holds a tenuous grip on the highest end offerings, with its GeForce GTX 280 GPU, this might soon slip, depending on the performance of AMD's dual processor 4870 X2 (R700) card, likely coming in Q3 2008.  Meanwhile, NVIDIA faces challenges from Intel in its low-end and laptop graphics offerings, and from AMD's PUMA chipset/graphics package in the laptop market.

The economic repercussions of NVIDIA's slippage are already visible.  NVIDIA announced yesterday that it was going to turn in revenue of $875 million to $950 million for Q2 2008, which ends July 27.  This is significantly lower than the current analyst expectations of $1.1 billion.

That was not the end of the bad news from NVIDIA either.  It announced that it was facing a massive recall, due to overheating GPUs in notebook computers.  NVIDIA reported higher than average failures in both the laptop GPUs and in laptop chipsets.

NVIDIA said that the chips and their packaging were made with materials that proved to be too "weak".  NVIDIA passes the blame to notebook manufacturers, which it says contributes to the problem.  Typically notebooks have poorer ventilation and components concentrated in a smaller space than desktop computers.

The result of the recalls is that NVIDIA will be taking a onetime charge of $150M USD to $200M USD to cover the damages.  It plans to use the money to repair or replace defective parts.  It also hopes to collect part of the money from insurers it uses.  However, it has acknowledged its problems and switched the materials it uses.

The news has resulted in NVIDIA taking a beating on the stock market, sliding over 25 percent.

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RE: Ow
By DEVGRU on 7/3/2008 11:46:21 AM , Rating: 2
...Lest we forget usually much higher power consumption, and higher temperatures...

RE: Ow
By Goty on 7/3/2008 11:49:57 AM , Rating: 2
Well, the actual power consumption isn't a whole lot more than the RV770 GPUs, and the temperatures are actaully not too bad, either.

RE: Ow
By nosfe on 7/3/2008 12:44:49 PM , Rating: 2
well, they did say that based on polls noise was a bigger concern to their users then temperature and to be frank, that's also how i feel about it, i prefer it to be a little hotter then to have a hairdryer in my case, also there are unofficial fixes for the temperature problem(make the fan spin at ~40% and lose ~20C at idle without much noise added, or so i've read in the forums)

RE: Ow
By thestain on 7/3/2008 2:33:59 PM , Rating: 2
How about more details?

From quick reading of various news stories, no mention is made of which gpu's on which motherboards are or have had these problems and which laptop makers. Did Dell or some other big lap top maker screw up?

Which motherboards are having these problems? No mention of any particulars... please tell us more!!

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