Nvidia to grab market control from ATI

But only in the desktop PC sector...

Nvidia is about to overtake ATI as the world's leading 3D graphics chip supplier, according to... er... Nvidia.

The company doesn't provide any hard evidence for this, but market research does tend to support Nvidia's claim, it has to be said.

Nvidia bases its claim on the strides it has made selling chips to PC makers eager to keep up with the latest 3D graphics technologies - or at least ones they can bundle without upping the cost of their products too much.

This OEM business has long been ATI's strong point after it wrested domination of the graphics chip market from S3 some years back. Of late, however, ATI's share has been falling, knocked down by the ascendant Nvidia.

According to Mercury Research, ATI's share of the desktop 3D graphics business fell to 36 per cent by the end of Q2 2000, while Nvidia took 35 per cent. With Nvidia's aggressive roll-out of new chips, and the delay ATI has experienced shipping its high-end Radeon part, it's not hard to imagine that the Q3 figures will show Nvidia surging past ATI.

"We've been getting more and more wins in the desktop market," said Daniel Vivoli, Nvidia's chief spin doctor, according to CNet. "Our product line of high-performance graphics has helped us dominate the segment." He also said he too expects his company will have out-sold ATI during the third quarter.

Still, it's not yet time to write off ATI. The desktop market isn't the be all and end all of the 3D graphics business. Nvidia's success has come by aggressively targeting the OEM desktop market and, more recently, with the launch of the GeForce 2 MX, the notebook arena. ATI remains strong in that space, thanks to its Rage Mobility line-up, soon to be updated with Radeon chips. Nvidia is also looking to the wider chip-set market, where, again, ATI already has a presence and will be launching products next year.

Finally, ATI has a major supply deal with Nintendo to supply graphics chips for the latter's GameCube console due late next year. That should match Nvidia's X-box win, will see it supply 3D silicon and more for Microsoft's entry into the console market.

ATI's latest Radeon roadmap suggests that the company has been shocked out of its success-induced lethargy and realises it needs to be a damn site more aggressive it it's to retain its leadership of the market.

That said, Nvidia remains fleet of foot, having an ongoing six-monthly release schedule, and the profits to back up such a rapid development, so it's not going to give any ground to ATI unless it has to.

Expect the race to be a close one. ®

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