Nvidia buys PDA, phone graphics chip maker

Nvidia today said it will buy MediaQ, a developer of graphics and other ancillary chips for wireless PDAs and cellphones, for $70 million in cash and stock, mostly the former.

Interestingly, the announcement follows a number of suggestions posted on web sites that Nvidia is developing a PDA-oriented chip, possibly codenamed the NV33. While the NV33 is now believed not to be the mobile processor, it's entirely possible that talk of said ultimately arose out the company's discussions with MediaQ.

MediaQ was founded in 1997. Today it offers three product families, the MQ1000, MQ2000 and MQ9000. The first offers "high-end graphics, camera and connectivity capabilities" for handheld systems and smartphones. The MQ2000 family extends that with more advanced multimedia and LCD-control facilities. The MQ9000 series, meanwhile, is a range of ARM9-based sub-processors designed to accelerate graphics rendering, imaging, video streaming, Java processing and the like.

Each chip is designed to provide very low power consumption and energy efficiency, and is backed with drivers for Windows Mobile 2003 for Pocket PCs and Smartphones, Palm OS and Symbian.

The company lists the likes of Dell, HP, Palm, Psion, Philips, Sony, Sharp, Siemens, NTT DoCoMo, Panasonic and Mitsubishi among its customers. Like Nvidia, it doesn't fab its own chips; unlike Nvidia it uses UMC to do so.

A privately held company, Media Q has not published financial results. To date it has raised over $55 million in finance from companies including Weston-Presidio Capital, El Dorado Ventures, Summit Accelerator Fund and ViVentures. National Semiconductor and Infineon and are named as corporate investors.

For Nvidia, the deal is all about expanding the range of platforms it covers. Nvidia won't have bought the company for its graphics expertise, but MediaQ will bring Nvidia skills in low-power designs, SoCs and a better understanding of the needs of the PDA and handset markets. MediaQ has plenty of contacts in the LCD world, too, which are likely to come in handy as liquid crystal panels continue to displace CRTs on the desktop, and more and more users choose to buy notebook PCs.

It also provides Nvidia with products to use against arch-rival ATI's Imageon range of PDA-oriented devices, the result of ATI's purchase some years ago of SoC specialist Chromatic Research. ATI's Imageon 3200 competes with the likes of MediaQ's MQ9000.

Nvidia expects the deal to go through this quarter, the third of its 2004 fiscal year. ®