Published in Graphics

Nvidia sacrificed console deals for Tegra

by on28 February 2013

Didn't have engineers to spare

Getting a console deal is great. People talk about you outside your usual graphics environment, and you make a stronger name in the game developer world, but not much money. Selling chips to Sony and Microsoft for their consoles can make you some money but definitely not billions.

By now you should be aware that AMD won all three major console deals and two of these deals are already public. Nintendo Wii U uses AMD graphics chip while PlayStation 4 uses AMDs Temash based APU that has both CPU and graphics inside. Temash is something that Nvidia could not compete with simply as Nvidia can only sell graphics, not an integrated chip with a CPU and GPU on board. Xbox next (720) or whatever Microsoft decides to call it will also have AMD APU inside making it a clear win for AMD.

A few years back, Nvidia had a difficult decision to make. The company could either compete for next generation consoles or it could go to mobile and make the chip that we all known as Tegra today. Nvidia didn’t have enough engineers to do both products, and in the longer run, having a presence in tablet and smartphone market could potentially reward the company with billions of dollars in revenue.

Nvidia was off to a slow start with the original Tegra, winning Microsoft Zune (That went well ed. ), continuing with Tegra 2 that found its way into a few phones including world's first dual-core LG Optimus 2X, as well as quite a few tablet designs. Tegra 3 got a few important phone designs including HTC One X as well as a few tablets, including the Google Nexus 7 and Microsoft Surface RT. Tegra 4 got delayed but despite that it has pretty got chance to increase Nvidia's market share in the mobile SoC industry.

The bottom line is that Nvidia did lose all console deals, but its team of Tegra engineers made a more valuable product, at least in theory. Future Tegra chips are expected to make more money than console deals, but at the same time losing consoles will definitely get AMD more love from developers. Nvidia traditionally dominated developer's relations and made quite a good effort to convince the developers to develop on Nvidia, for Nvidia.

Since AMD has the console wins, it will be easier for developers to optimize for AMD making it slightly harder for Nvidia to fight them in the PC space, but it will be interesting to watch. It took us quite a lot of time to investigate and get some hard facts and now we can say that this is why AMD won all the consoles, at least this is one side of the story.

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