Nvidia, Via Prepare to Take On Intel
In the MID and low-cost PCs spaces, Intel finds new challengers outside of AMD.For years, the rivalry between Intel and Advanced Micro Devices helped define not only the x86 microprocessor market but also the PCs and server systems that used the chips from these two companies.
Now it seems that Intel is preparing to face off against a pair of very different companies.
In two weeks' time, Nvidia, which is best known for its line of graphics processors, announced it had a new platform called Tegra that will challenge Intel in the still-emerging market of mobile Internet devices, or MIDs, while Via plans to compete against Intel in the low-cost notebook market with a line of low-watt, x86 processors called Nano.
Intel had planned to come into both markets with its line of Atom processors -- Silverthorne for MIDs and Diamondville for low-cost PCs -- and define these markets through its technical innovations, marketing muscle and strong relationship with the hardware vendors.
In a way, Intel, Via and Nvidia are all looking for the next great opportunity to grow their businesses outside the traditional PC market and create processors that will define these new areas. What all three companies have found, and what they have developed products for, is that these markets involve low-cost, mobile devices that can connect a user to the Internet at any time. Intel CEO Paul Otellini has said all these markets, which also include new uses for embedded processors, could be worth up to $40 billion. The reports from Taiwan and the 2008 Computex conference, which started June 3, seem to confirm that the industry has taken notice.
While neither Nvidia nor Via can compete again the size of Intel, analysts believe the two companies might have enough technical savvy to compete against the larger rival in two very specific market segments and customers. At the same time, vendors might seek out an alternative as they did with AMD in the mainstream PC and server market.
Via had been the main supplier of CPUs into this market of small form factor PCs for years with a line of low-watt processors. Nano represents a new architecture designed to compete against the Intel Atom for PCs by increasing the performance of the chips, while keeping the thermal envelope at 25 watts or less. These new designs could give Via an advantage against Intel as the logical alternative. Hewlett-Packard seemed ready to give the company's chips a chance with its $499 Mini-Note laptop although that uses the older C7 series processors.
"The low-cost market is going to be very competitive," said Nathan Brookwood, an analyst with Insight 64. "What you saw, especially with AMD versus Intel, is that all things being equal, the customers like to see competition in the market from another supplier other than Intel as long as that competitor has a reasonable product."
Still, Intel's sheer size and the fact that Atom is still a first-generation product means that further improvements, such as a shrink from 45-nanometers to 32-nm in the next year to 18 months, means that it will be able to offer more features at less of price at a much quicker pace than Via.
In the nascent MID market, the differences between Nvidia and Intel are even greater, as both companies look to define what these devices look like. At that same time, Nvidia and Intel are offering platforms that could also fit well with smartphones such as the Apple iPhone.
With Tegra, Nvidia used its own graphics technology but went with an ARM 11CPU, which means that the whole platform will use less than 1 watt of power. Intel's Atom chips for MIDs, on the other hand, are based on x86 architecture and consume between 2.5 watts and 0.65 watts of power.
Rob Enderle, an analyst with the Enderle Group, said that at this stage of the MID game, Nvidia would seem to have the advantage in terms of power consumption and the fact that ARM CPUs dominate the smartphone market. "Unlike Via, Nvidia clearly has budget," said Enderle. "In the short term, Nvidia has a clear advantage in overall performance for the buck in a small [thermal] envelope. In the short term, it's all about performance and battery life. I think when Atom falls into the thermal envelope that ARM has, it's going to make an interesting fight." However, Intel will eventually get its power envelope down and it's much easier to develop a wide range of applications on an x86 platform compared to one based on an ARM CPU. In addition, the x86 platform will allow a device to support a full Microsoft Windows or Linux environment. While all the talk is about Atom this year, Intel is already preparing to launch a new platform for MIDs called "Moorestown" in 2009, which should offer a number of improvements, including built-in graphics and video capabilities. The question now is what will happen to Nvidia and Via as they bet heavily on these new markets. Some industry watchers believe Nvidia could buy Via and then have access to its x86 technology, which could create a way for the company to offer platforms with both ARM-based and x86-based platforms for MIDs. "Nvidia and Via together could provide a strategic solution," Enderle said, but added that the two companies have different corporate cultures, which could make a merger difficult.