January 18, 2011
In the rush to cover last week's turmoil at Advanced Micro Devices (NYSE: AMD ) , industry watchers never fully answered the question of how NVIDIA (Nasdaq: NVDA ) might benefit from the fallout. It's time to fill the void.
But first, let's review. AMD's board ousted CEO Dirk Meyer for failing to deliver a winning mobile strategy, allowing Intel (Nasdaq: INTC ) and ARM Holdings (Nasdaq: ARMH ) to dominate the form factor. NVIDIA, and more recently MIPS Technologies (Nasdaq: MIPS ) have also made gains. Everyone, it seems, except for AMD.
So Meyer's out. What's this mean for NVIDIA? Two things, I think:
- Project Denver gets breathing space. By booting Meyer, AMD's board is essentially committing the company to pour resources into a mobile strategy that has at least a 50-50 chance of failure. With fewer resources available to fight for desktop and laptop share, AMD could have a harder time defending against NVIDIA when its "Project Denver" yields an ARM-powered CPU chip worthy of becoming an Intel and AMD alternative in Windows machines.
- A need to move fast to secure tablet share. At CES, NVIDIA showed a number of design wins for its Tegra chips in Android tablets. But this is also a nascent market, and if AMD moves quickly with Fusion chips or another low-powered alternative, there's room to capture tablets not yet powered by ARM-NVIDIA or Intel's Atom. Only a healthy diet of regular, tablet-sized upgrades to Tegra can keep this from happening.
Of course, that's just my take. Now it's your turn to weigh in. Will Project Denver reshape the PC industry? Will AMD win in the mobile marketplace? Please vote in the poll below and then leave a comment to explain your thinking.
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