NVIDIA Bowing Out of the 'Mainstream' Tablet & Smartphone Market to Focus on High-End

[dgstorm]

It seems like strange timing, but NVIDIA's CEO Jen-Hsun Huang announced the company's plans to take a step back from developing technology geared specifically for the mainstream tablet and smartphone markets. NVIDIA is currently gearing up to the next level with their next-gen Tegra K1 chip. It's extremely powerful and recently bested the competition by a wide margin in some artificial benchmarks.

This is why NVIDIA's move seems a bit puzzling at first. Of course, after reading Huang's perspective on the subject, it begins to make a bit more sense. NVIDIA has realized their higher-end technology isn't meant to compete with the menagerie of mediocre mobile models available. While NVIDIA was striving to take on their biggest rival, Qualcomm, the smaller MediaTek was swooping in to dominate in the low-end markets. This was basically pushing NVIDIA from two sides.

To be clear, NVIDIA is not at all abandoning mobile. On the contrary, they are instead refocusing their efforts on future tech and on markets they have always been good it. That is automotive mobile and mobile gaming respectively. Huang indicated he doesn’t want NVIDIA's flagship Tegra brand conforming to inferior standards. NVIDIA sees the Tegra as a powerful line which should not have its standards sacrificed in the name of more efficient chipsets. In other words, NVIDIA wants to be the Lamborghini or Ferrari of mobile chipsets, instead of catering to mass production markets eventually relegating the Tegra line to that of a value sedan.

The above cars all have Tegra chips inside powering their on-board mobile connectivity functions.​

In retrospect, this move makes a great deal of sense. NVIDIA has always been one of the two big titans in the gaming world. They are experts at fighting in that market. Of course, the mobile auto industry is new, but if NVIDIA can get there first, they can get a leg up on the rest of the mobile industry while their competitors' focus on smartphones and tablets.

It sounds like NVIDIA will still have chipsets for tablets, but they will more than likely be geared towards gaming. Of course, the NVIDIA Shield device is also their baby, and Huang renewed their commitment to that product. In fact, Haung made it clear that he believes NVIDIA Shield will be the device which transforms Android into a great gaming platform.

There was a great deal more shared in the interview over on CNET, so be sure to check it out for even more clarity on the subject. What do you guys think? Is this a smart move on NVIDIA's part or just forced timing?

Source: CNET

 

[Jeffrey]

Hey David. When did you take a picture of my cars?

 

[kodiak799]

So basically they can't compete on an economic/efficiency production front, so they are eliminating like 80% of the market (i.e. kneecapping growth potential). And, unlike Intel, their brand is not strong enough to muscle out lesser, but cheaper alternatives.

There are things that set apart Ferrari and Lamborghini in the otherwise "commoditized" auto market...none of which particularly apply to silicon inside a device.

As an investor, I wouldn't consider this news to be encouraging.

 

[Vepaot]

I like the new mindset. They weren't making any headway against Qualcomm, and their Snapdragon line seems to dominate the industry at the moment.

I've loved my OG N7 from day one. The Tegra 3 in it has handled everything I've thrown at it with ease. I kind of skipped out on the Tegra 4, but if they build a badass gaming tablet with their K1 SoC, I'll definitely pick that up.

 

[cybertec69]

The Lambo must be the CEO'S. That's the new Huracan.

 

[combatmedic870]

Nooooooooo!!! If they would actually put their chip set into a main stream phone they might actually get somewhere!!
This is the second in 2 years. Now there is just Qualcomm.

 

[Macktion]

I would like to have seen NVIDIA stick around in the 'affordable' bracket of devices... :-(

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