For a long time, Nvidia was just a GPU manufacturer. Arguably, they offer one of the best graphics processing components for high end rigs, the GeForce series GPUs.
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Thanks to changes in the mobile industry, Nvidia ventured out and created components for mobile PCs, smartphones and tablets. It gave rise to the Tegra series of chipsets, a particular brand that we’re all quite familiar with. As it would turn out, Nvidia made a good choice breaking into the mobile device market. Despite plummeting PC sales, Nvidia reported earnings of $4.28 billion dollars for the year, which is a remarkable 7.1 percent increase from last year’s earnings. Clearly, their ventures in the mobile industry are valuable to the company.
Nvidia’s Tegra processors appear in a wide swath of mobile devices, like the Microsoft Surface RT, Google Nexus 7, and even the upcoming Android console OUYA. Nvidia’s CEO, Jen-Hsun Huang believes that the tablet market is where all the buzz is happening.
“Yes, I believe in tablets. I believe in tablets wholeheartedly.”
Huang made that statement yesterday, to investors. He also discussed why the company is investing heavily in the tablet market.
“Though people have been skeptical about Android tablets, we’ve stuck with it… we believed in the Google cloud. We believe that people will buy books and music and games and movies and store their photographs up in the cloud. When you put all your personal content up in the cloud you want to enjoy it when you’re home, and in a larger format, which is an Android tablet.”
Huang also revealed that Android isn’t the only platform Nvidia is dedicated to. He expects to see success with the Window RT tablet, the only Microsoft model that’s actually using a Tegra chipset.
“I believe it is strategically essential for Microsoft to be on all the processors in the world, and surely the highest volume processor. Now, whether people see Win RT as a consumer tablet or a full computer… that’s yet to be determined.”
He further clarified his position by revealing Microsoft tablets powered by the Tegra 4 are on the way.
“It stands to reason that there are many more Win RT Tegra 4 tablets in development. We know what it’s like on top of a Tegra 4, and it rocks.”
Throughout the discussion, however, a certain pattern stands out. Huang commonly refers to tablets and the respective market, yet there’s little or no mention of the smartphone market. Which is odd because the smartphone market is clearly more profitable, of the two.
Huang says that the company has future plans for the smartphone industry, but they’re not quite ready for it.
Qualcomm has seen an tremendous surge of success thanks to their recent Snapdragon S4 chipset, mainly because it contains an integrated LTE modem. This feature allows mobile devices to see much faster wireless data speeds, yet it still maintains competitive energy consumption ratings.
Nvidia is currently working on an LTE modem, to increase efficiency of their future mobile chipset offerings, but such technology won’t be available anytime soon. In fact, we won’t see Nvidia chipsets with an integrated LTE modem until later this year. Huang also outlined that this type of technology is the key to being successful in the current mobile industry. Obviously, Nvidia is looking to take on competitors like Qualcomm in the near future.
“Smartphones… this is an area where we’ll need to have an LTE modem to be successful. We’ll have some phone success this year, but we don’t expect to have a whole lot of phone design wins until we engage the market with LTE.”
Nvidia is looking to be more competitive in the smartphone market, but there’s no denying the success they’ve met in the tablet market. While I’m not too sure about the Windows RT platform myself, at least Huang has a good amount of confidence towards it.
Tablets and smartphones are driving computer sales down significantly. Tablets are lightweight, in some cases just as powerful, and often half the cost of a high-end desktop PC. While computers will always be a staple in the world of technology, it was clearly a smart move by Nvidia to move into new territory.
$4.28 billion in earnings for last year, just shows that so far, Nvidia’s business model has been spot on.
Image: Droid Life