In time for the hottest event of the season, NVIDIA's (Nasdaq: NVDA ) Fermi is ready for its unveiling to the masses. Not sure what Fermi is? While Fermi might sound like the name of a long-lost aunt from the Midwest, it's actually big news in the graphics card industry.
Allow me to introduce you to Fermi
Fermi is NVIDIA's newest chip architecture, and it was extremely ambitious in its design. Up until now, it has only been available on high-end graphics cards costing up to $500. However, starting today, NVIDIA's changing all that. The company is launching a new Fermi-based line at the $200 price point.
The GTX 460- Fermi's entry into the mainstream market.
NVIDIA's new GTX 460 will come in two flavors, a card with a suggested selling price at $200, and a slightly more souped-up card priced at $230. The $200 price point is significant because it represents a "sweet-spot" in the graphics card industry. NVIDIA is quick to point out that surveys show gamers have the most interest in cards within this price range.
The season's main event
Also, as alluded to earlier, the top gaming event of the season is about to launch. That's Activision Blizzard's (Nasdaq: ATVI ) Starcraft 2, which is launches on July 27th. While Starcraft 2 updated graphics and technology, it appeals to far wider demographics beyond gaming enthusiasts spending a small fortune on their graphics cards. By launching the GTX 460 now, NVIDIA can better target gamers upgrading in front of Starcraft's launch.
For NVIDIA investors, seeing Fermi expand across the product line is long-awaited news. NVIDIA's largely been uncompetitive with AMD (NYSE: AMD ) in graphics cards priced around this "sweet spot" thanks to an aging product line. Also encouraging is NVIDIA's promises of a full geographic launch. The company has been touting strength in foreign markets, and Starcraft is a truly global phenomenon which should be able to drive sales across multiple regions if the card sees widespread availability.
Back up off the canvas!
Aside from the biased folks at NVIDIA, no one's calling Fermi a raging success thus far. For this reason, a strong GTX 460 launch takes on more importance than the usual card launch. With the company struggling to win smartphone battles against Texas Instruments (NYSE: TXN ) and Qualcomm (Nasdaq: QCOM ) in the smartphone processor space and Intel (Nasdaq: INTC ) once again setting its sights on high-performance computers with its new Knight's Corner line, the competitive heat has definitely been cranked up. What NVIDIA needs is a home run in its bread-and-butter consumer graphics card space.
From the early reviews of the card, it looks like they've done just that with the GTX 460. The graphics card space is filled with very educated consumers, and you can only coast on your name and reputation for so long. NVIDIA burned some of its cachet over the past year, but if successful reviews for this card keep holding up, it looks like Fermi's finally pulling its weight for the company. Constrained supplies can only hide product line-up wars for so long. This newest card isn't a panacea for what ails NVIDIA, but sometimes just getting back on track is good enough.