Back when NVIDIA (NASDAQ: NVDA ) first announced the Shield handheld gaming device at the beginning of 2013, I was highly skeptical. It seemed that the Shield tried to fill a gap that didn't really exist, and that competing against the phones and tablets that most people already own would be a difficult task. The Shield has received plenty of new features since then, however, and the most recent update has convinced me that the product has a real place in a crowded mobile gaming market. The Shield has quietly become a mobile gaming powerhouse, and here's what it means for NVIDIA.
What is Shield?
The NVIDIA Shield is a handheld Android-based gaming console, sporting a built-in controller and a five-inch 720p screen. The device is powered by NVIDIA's Tegra 4 processor, making it more capable of playing games than the typical smartphone or tablet.
Currently on sale for $199, Shield is an expensive way to play the same games that can be played on a smartphone or tablet. Granted, there are some Android games specifically optimized for the Tegra 4 processor, but this alone doesn't justify the price tag.
At launch, the Shield offered little more than Android gaming. It was capable of streaming PC games from a computer with a recent NVIDIA graphics card on the same network, but the prospect of playing a PC game on a tiny screen when the PC actually running the game was in the next room seemed unappealing.
New features have been continually added since launch, and now the Shield actually looks to be a compelling product, at least for serious PC gamers.
A versatile device
The addition of console mode allows the Shield to be hooked up to a TV and played using a Bluetooth controller or keyboard and mouse. Playing Android games on a TV isn't all that appealing, but being able to use the Shield to stream a PC game to the TV gives the device a real purpose. It's not the cheapest way to play PC games on a TV – running an HDMI cable would accomplish the same thing – but it's far more convenient. The Shield now supports streaming at a 1080p resolution at 60 frames per second, making it a very viable way to enjoy PC games in the living room.
The most recent software update adds a significant new feature – remote streaming. The Shield can now stream games directly from a gaming PC over the Internet, as long as the connection is fast enough. This allows users to play PC games on the go. This, along with the beta of NVIDIA's GRID cloud gaming service that allows Shield users to stream PC games from NVIDIA's data centers, has turned the Shield into an extremely powerful mobile gaming device.
What this means for NVIDIA
The Shield is still a niche device, requiring a fairly recent NVIDIA graphics card in order to take advantage of its game streaming features. Its ability to easily bring PC games to a TV without a degradation in quality gives serious gamers a good reason to choose a NVIDIA GPU over one from AMD (NASDAQ: AMD ) , however. NVIDIA has been working to build an ecosystem around its graphics cards, and the Shield is just a part of it.
NVIDIA's GeForce Experience is a software suite that enables some useful features for owners of NVIDIA's graphics cards. A feature called "Shadowplay" uses hardware that's built in to NVIDIA's Kepler-based GPUs to record gameplay footage with very few negative effects in terms of performance. It also allows gamers to broadcast this footage directly to Twitch, a popular website that allows gamers to broadcast gameplay over the Internet.
This software, along with the features of Shield, allows NVIDIA to differentiate its GPUs on something other than price and performance. While AMD has its Raptr software that offers many of these features, Shield offers something that AMD can't match.
The bottom line
NVIDIA's Shield has slowly transformed from a device with little reason to exist to a versatile mobile gaming powerhouse that gives gamers a reason to choose NVIDIA GPUs over those from AMD. Although it remains a niche device, Shield strengthens NVIDIA's already strong position in the PC gaming market, especially now that PC games can be played on the go. The Shield will not be the kind of device that sells millions of units, but it will help NVIDIA sell more high-end GPUs.
Mobile gaming is big, but this is bigger
If you thought the iPod, the iPhone, and the iPad were amazing, just wait until you see this. One hundred of Apple's top engineers are busy building one in a secret lab. And an ABI Research report predicts 485 million of them could be sold over the next decade. But you can invest in it right now... for just a fraction of the price of AAPL stock. Click here to get the full story in this eye-opening new report.