David Dyess IIA lot has been happening lately for and against the GPU market: Intel launched its Arc GPU; NVIDIA announces the death of Moore’s Law; EVGA is no longer producing NVIDIA GPUs; GPU prices have downturned from the 2 year COVID-19/crypto mining/scalping price gouging. This feels a little like the late 1990s, to me anyway.
While NVIDIA has been a pioneer in the “GPU” industry from its beginning (it was the first to call it a GPU, even though it’s arguable if it was actually the first consumer GPU – the NVIDIA GeForce 3 was the first capable of shaders, that is true), they weren’t always the first or the best. NVIDIA’s consumer GPUs were actually difficult to find in the late 1990s/early 2000s. I remember looking for one and ended up getting a Voodoo 3, which was the first GPU I can remember purchasing. My Voodoo 3 card could hang with anything I threw at it, even after 3dfx had gone belly up. I did end up purchasing a GeForce FX GPU, around 2004, which was a giant leap from my old Voodoo 3.
For those who don’t know, 3dfx very briefly had the GPU market share cornered, they were a powerhouse and their own worst enemy. Their fate changed very quickly, for 2 main reasons: they moved away from 3rd party chip manufacturers (like AMD and NVIDIA use today) and they raised their prices. I’ve been thinking about this ever since EVGA announced it would no longer offer NVIDIA GPUs. The reason EVGA gave for dropping NVIDIA was profit margins. EVGA has 40% OF NVIDIA’s GPU market share in North America and it’s GPU business pulls in a big chunk of it’s revenue. I can’t help but to think they have to transition to another GPU chipset, but which one? I also can’t help but think EVGA isn’t the only unhappy NVIDIA partner.
NVIDIA is reminding of 3dfx a lot lately. They are the clear leader in the GPU market, in both performance and market share. Unfortunately for them, and maybe fortunately for us, Intel and AMD are not that far behind. NVIDIA insists prices for GPUs will only get more expensive, which is unsustainable in the consumer market. The GPU shortage somehow showed NVIDIA they can charge more for their GPUs, even though most people have only began buying them now that the prices are falling. All the while, NVIDIA had been steadily increasing their new GPU prices with every generation it released.
I don’t think NVIDIA is going away anytime soon, but I also don’t think consumers will continue to cater to NVIDIA’s sense of self-importance. Intel is positioned to make some noise in the GPU market, especially if they can get their drivers on point for both Windows and Linux. Intel could cut into AMD’s market share in Linux, where many prefer the much easier compatibility of AMD over NVIDIA, and the consumers tend to be more cost-conscious. For now, I’m picking whichever company picks up EVGA for GPUs and I wouldn’t be surprised if EVGA partners with both AMD and Intel. If that happens, that could spell trouble for NVIDIA and their stance of continuing to raise GPU prices.