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Print 29 comment(s) - last by TheJian.. on Dec 6 at 8:53 AM


Intel and NVIDIA have a common enemy -- the resurgent AMD. The pair are reportedly in talks to settle a long-standing lawsuit and increase their cooperation.  (Source: Anandtech)

AMD is currently crushing NVIDIA in the discrete GPU market and gaining ground on Intel in the CPU market.  (Source: AMD)
Union may represent effort to hold off surging AMD

NVIDIA has new GPUs (the 500 series) -- but so does AMD.  And AMD is currently beating NVIDIA in sales of discrete GPUs. 

Likewise Intel, long having dominated the netbook/light laptop market with its Atom process is concerned about AMD's new "Fusion" accelerated processing unit, which packs a better integrated GPU than atom.  Intel's primary hope to hang on to its market share involves pairing Atom with NVIDIA's ION lightweight GPU at an affordable price.  But Intel and NVIDIA have been involved in a bitter long-standing feud that has resulted in Intel making ION offerings more expensive than its own inferior chipset.

But much like Lex Luthor and Superman occasionally do in the comics, these bitter enemies have found cause to try to set their difference aside, while facing a common threat.  The pair was set to go to battle with each other in a trial starting Dec 6 in Delaware's Chancery Court.  NVIDIA and Intel, though, have asked the court to postpone the trial concerning licensing issues to 2011, buying time for a settlement.

Nvidia CEO Jen-Hsun Huang coyly commented, "We’re always in talks.  Our two companies are always in talks."

The settlement would be advantageous to both firms.  Both have grown weary during the long legal campaign, which has stretched over six years, since being filed in 2004.  The legal battle has been filled with suits and countersuits, with both chipmakers trying to deny each other access to their respective technologies, and alleging breaches of contract.

While Intel is the largest CPU chipmaker and NVIDIA is the world's second largest graphics chipmaker, both companies have missed out on potential revenue that could have come from joint products.

If they can reach a settlement, the quality of desktop hardware could be boosted.  By allowing NVIDIA the right to make chipsets for its new CPUs, something that Intel has currently rejected, consumers could gain access to faster gaming and productivity offerings.  And in the netbook sector the pair could at last offer an affordable ION+Atom platform that would mark a true competitor to AMD's dual-threat "Brazos" Fusion chip.

Is NVIDIA finally ready to put away its "can of whoop-ass"?  We should have an answer to that in weeks or months to come.


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By TheJian on 12/6/2010 8:53:18 AM , Rating: 2
I love AMD, currently own an 8850 (hey they were better at the time and I got a great deal). But anyone thinking they're running the show here is mistaken. Jason points to an article from July when AMD was in the lead (it's old news pal) and quoting AMD saying they're CRUSHING NVDA is laughable. Ask Microsoft and they'll tell you the Zune is king...ROFL. Well duh. Intel is about to write a CHECK to NVDA. Why so many people hate this company on AT/DT is beyond me. It's a well run company. Period. Hector drove AMD (and motorola's profits down 5bil then ran) into the ground. This is what happens when the wrong people run your company. He approved billions to buy ATI when they had never had a quarter where the graphics division made more than 60mil. What the...Thank god Dirk got back some power. Same thing happened at Intel when Grove left and marketing started running things with "BLUE CRYSTALS" instead of great products (caminogate, P4 etc). They had tons of cash though, so easily survived the messes. Check the income statements of NVDA/AMD. Note the outstanding shares of AMD has went from 430mil to 671mil in the last 5 years. That's umm...BAD. They get in trouble and dilute the shares more (about to do it again, selling more notes to cover debt). They haven't made money since 2005 (2004?). Losses EVERY year if you don't count the 1.25B settlement from Intel Nov '09, or the sale of the fab to cover debts. Those things don't count as a PRODUCT that makes money. They're still billions in debt and have to make a few hundred mil just to cover interest each year (which apparently isn't working as they've been losing that battle for 5-6 years). They're still a few bil in debt. Market share doesn't mean a thing if you can't make money on it. Apple owns a measly 2% of the entire phone market but makes an appalling 40% of the profits! NVDA knows how to make money on the market share they have or stem the tide until they can. AMD needs to price things where they profit or just continue to get weaker and weaker (sorry people, you might like their card/cpu price, but it's KILLING them). They had the strongest cpu for 2.5-3yrs and never made anything from it. Bring back JERRY SANDERS :) I loved that guy, they went to crap since he left.
http://moneycentral.msn.com/investor/invsub/result...
Check around in their statement for all the bad news. Ratios, debt, losses etc can all be found easily.

Now open up NVDA statements and look at the same summary. Note they haven't diluted their shares over the last 5 years by more than 10% or so (ok in a recession) and in fact are in a $2.7B buyback over the last 2yrs (still in it, should bring back to 0% dilution when done). http://uk.reuters.com/article/idUKN122893352008081...
If you take out the warranty repair crap from TSMC screwing up chips (NV doesn't make them ya know, and manufacturers didn't listen to thermal requirements, which is why HP coughed up 100mil for fixes etc) they would have had no losses in their last 10 years. Even with the losses it's only 100mil total in the two years they took hits ('08/'09). A major fiasco cost them 100mil in losses and they're back to profits. AMD? oh, 7-8Bil in losses in 5-6 years (take out Intel's check and sale of fabs it's UGLY). Note NVDA said they'd sue for all of it back. I think they just told TSMC make our chips for 10% less for 10 years (knowing they couldn't write a few hundred mil check out in a day- just a guesstimate but it's something like this) and dropped it. Do a little math, how do they make money having a bigger chip than AMD? TSMC makes them a bit cheaper due to the nuclear fallout from defective chips I'd guess + they're smart enough to price their products at least to break even in a storm (you say they're screwing you all, but can't be they're not rolling around in dough), while AMD just keeps selling at losses (fan favorite, but pricing is killing them). Also note Fermi is top to bottom now, so the reasons I bought my 8850 (heat/noise) are gone now for xmas sales. Merry xmas NVDA stock/sales (tegra 2 landing in phones etc now too-T3 already taped out ages ago). The stock market knows it, look at the last 2 months of their share price. Note also, NVDA could handle another few years of minute losses and laugh AMD's next products out of the market (Intel does the same). Just price your stuff where the enemy can't make money, accept a small or no loss and break even until you have a better product. Puny enemy makes nothing but more losses, gets weaker and sells more shares to survive. Wash/rinse/repeat until you dominate again. Like NVDA or hate them. This is reality. Intel just did this. NVDA's turn now. AMD just can't catch a break.

Again, NVDA isn't opening a can of kiss A$$, it's whoop A$$ when Intel writes a check to YOU because your case is a loser in the end. NVDA is in no danger from AMD. They have no debt, cash, a matching product in GPU's and Cell Phones and can pair their GPU with ARM etc for ages without needing anything as a cpu. Intel, however, can't make a GPU to save their life. Hence the CHECK goes to NVDA (further enhancing their balance sheet, and again making no need for a CPU on the laptop/netbook side either). TSMC is behind NVDA now, they paid and it's over. Their future is bright, and looking brighter now that they can pair their gpu's with every top cpu in any market. Be it the desktop, laptop, or cell/mobile markets. That's not helping AMD, integrated gpu/cpu or not.

You need to pay more attention to MONEY, rather than blissfully believing in a company. I hope AMD figures out a way to do better. But I look at your income/debt etc and judge, not how much I like your company (until core2 I was AMD except some celly 300a I remember). AMD is in dire trouble. Intel buying NVDA is the same deal as AMD buying ATI. It would cost too much (probably Jen would ask 20bil+ making INTC have some debt) and would likely be blocked by FCC anyway because Intel owns 50% of the market in gpu's (onboard and crappy - but it's 50% people). However, we should hope NVDA buys AMD making an ultra strong competitor to Intel and wouldn't make the FCC blink. We'd all be able to afford Intel's top end again. :)

I can't believe some of the articles on DT. I'll be shocked if AMD makes money Q1 (but Jason M. thinks world domination's in their future and has INTC quaking in boots...ROFL). NVDA however; I'll be shocked if they don't break 150mil (not incl Intel's check - alone on PRODUCT). If you own AMD, you're going to lose money. If you own NVDA, get ready to make some more. AMD will be VIA in 5yrs if NVDA or someone big doesn't buy them to fund their very good tech before it's wasted and can't be improved due to lack of funding. They've thrown 8Bil out the door and can't make money even with a dominant CPU for 3yrs, and then the dominant gpu for 18months. Barely made NVDA sweat (cash/no debt carried them through the storm), and Intel just laughs at 10.7Bil income in a recession (same carried them through 3yrs of AMD kicking the crap out of them...pay everyone, break laws etc until you're on top). It's not rocket science. Simple math. AMD will soon not be able to secure debt, become junk status and investing in anything past Bulldozer gets REALLY difficult. I hope they're bought before then. NVDA should have bought them at $2 a share, in cash. That made sense. I hope for all our sakes they get another shot (or someone else does). Or as someone else said, NV could buy Via for x86 (not sure if that would work). Not sure of the value of VIA anyway. It's tough to valuate a company in Taiwan :) If my math is anywhere near correct it would be a merger not a buyout in that case (I think their valued at about NVDA). Either way, INTC/NVDA future's are bright, AMD is NOT in a dominant position even if we wish it so.




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