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Nvidia: AMD remains a strong competitor

Chief executive officer of Nvidia Corp. said last week that Advanced Micro Devices has always been a serious rival for his company and remains a tough competitor today. However, Nvidia believes that its new business approach greatly helps it to avoid competing directly with other suppliers.

“[AMD has] been a strong competitor for as long as I can remember, and they remain a strong competitor,” said Jen-Hsun Huang, chief executive officer of Nvidia, at the company’s conference call with investors and financial analysts. “It is just that our strategy is very different now. We used to be much more of a component supplier, competing directly with other component suppliers, but increasingly, we are really a differentiated platform supplier. The software investments that we have made over the years really, really increasingly define our product.”

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Products like Nvidia Quadro, Nvidia Tesla and Nvidia Grid are based on similar graphics processors that power GeForce graphics cards. However, thanks to state-of-the-art software, they gain exclusive capabilities and can be sold with huge profit margins. While AMD competes against Nvidia on the market of graphics cards for PCs and workstations, the company’s position on the markets of high-performance computing and datacenters are rather weak.

“When we think about our products and our platforms, it is really about the differentiated value that we have built on top of our GPUs, number one; and number two, I think the deep integration with the large ecosystems around the world, to the point where other companies’ capabilities are really glommed onto this platform, making this platform more valuable to customers,” said Mr. Huang.

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KitGuru Says: When it comes to hardware, AMD can really compete against Nvidia very well with its powerful desktop GPUs. Unfortunately, when it comes to software and eco-systems, Nvidia is considerably ahead and it is unlikely that AMD will catch up with Nvidia any time soon.

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