Intel Pays OEMs To Keep Nvidia Out Of Netbook, Atom Market

June 16, 2009
Nvidias ION netbook platform surpasses even Intels latest consumer ultra-low voltage system

Nvidia's ION netbook platform surpasses even Intel's latest consumer ultra-low voltage (CULV) system to ship next quarter!

The secret is finally out.

At Nvidia’s analyst conference today, CEO Jen-Hsun Huang explained how Intel is trying to keep Nvidia out of the Atom-based netbook market it entered late last year with its ION platform, boosting the graphics and video performance of a netbook to a point it rivals higher-end laptops.

According to Huang, it costs $75 for a PC manufacturer or OEM to buy both Intel’s Atom processor ($40) and Nvidia’s ION platform ($35).

“But if you buy Atom and use the 2 other chips (including an integrated graphics chip) that come with it, it’s $25. So the 2 chipsets we are competing against ION is negative 30 dollars,” said Huang.

In order words, Intel is giving away $30 to OEMs for not buying Nvidia!

“If a company is willing to give you $30 for every unit that you buy, you just have to buy enough and you’ll be rich. I might even be their largest customer,” jokes Nvidia’s CEO.

Despite Intel’s “extraordinary” subsidies, Nvidia still managed to convince dozens of OEMs to adopt its ION platform, including Acer and Lenovo, because there are some markets where free is not enough. “And those are my customers,” adds Huang.

“If someone offers an MP3 player for free… as the electronics cost of an MP3 player is approximately nothing… yet there are still people who go and pay $79 for [an iPod]!”

But Nvidia is no Apple despite Huang’s multiple references to the Cupertino, Calif.-computer maker.

Here’s a video excerpt of CEO Jen-Hsun Huang comments on Intel’s anti-competitive actions to keep Nvidia off the netbook market:


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