Nvidia: Not Enough Money in a PS4 GPU for us to bother

[96Firebird]

I might be missing your /sarcasm tag on this.

I read everything that kid posts with sarcasm tags, surely no one in their right mind believes the nonsense he types.

 

[Imouto]

Is that why Nvidia's GeForce division makes ~10x the profit of AMD's GPU division quarter after quarter?

You're lying, but I guess you'll say the same as Ibra if I request a link.

 

[cplusplus]

Sure, in the last few years. But since the consoles are close to dead due to new consoles. There is no way to recoup it.

Loss, loss, loss nomatter how you turn it.

Not really. The PS2 sold about 30 million more systems after the release of the PS3.

 

[NTMBK]

Not really. The PS2 sold about 30 million more systems after the release of the PS3.

This. Sony just brought out an even lower cost version of the PS3, and they could still shrink the Cell again to get production costs down. They could sell bargain basement PS3s for years to come, and turn a profit on every one.

 

[blackened23]

But they dont get enough to turn a profit. I wonder if the nextgen 70$ games is simply a 10$ addon for Sony/MS.

I don't think this is quite true. First things first, the profit or lack of profit for sony or microsoft has little bearing on the component cost - they will pay that regardless even if it is at a loss. Nvidia received 125$ for the PS3 GPU. We don't know what upfront cost they received - but we do know that they received a 200 million upfront advance, not including per chip costs, for the original xbox. That was in 2001 - such a figure would be far higher currently. As you can see, the component suppliers STILL get a profit regardless of what the profit level of microsoft and sony are.

The other thing I should mention is that some here are stating that consoles are not profitable. That is ridiculous - you should really qualify that statement. They are not initially profitable, but with die shrinks and component cost reductions they eventually will become profitable. A cursory search reveals that the xbox 360 hardware became profitable in 2008, 3 years after release. This means that every xbox 360 that microsoft sells turns a profit, and with process improvements this is around 100$ per console.

Again, the profit level that microsoft or sony make have NO BEARING on what component cost manufacturers get. As you can see from the figures above, nvidia made quite a profit in 2001 with the original xbox. 200 million and that doesn't even include per chip costs. So there is money to be made, nvidia is just playing the PR game by stating they didn't want to be in PS4 - they hired the former contract negotiator from AMD that handled their console division. Now why would they do that if they, "didn't care". Give me a break. Of course they care, because consoles influence everything in the gaming industry, even PCs - if nvidia loses influence with consoles they will lose influence with PC game developers as well to a certain extent. Consoles will be x86 from here on out. And they will use AMD GPUs, and will be coded for AMD GPUs. Now, I understand that nvidia wants to focus on mobile chips and that's great. But to say they "don't care"? I find that to be a disingenuous PR game.

But, with the extremely biased posters here nvidia "didn't care". "doesn't need consoles". "AMD will fail". blah blah blah blah. If you say so. Actually, I agree they don't need consoles. They will be fine, and will do very well with Tegra. But, they do care, you can be assured of that - they would not have hired AMDs console division head if they "didn't care". Of course they care. But it isn't a make or break deal for nvidia - you are correct in that respect...they will lose influence with game development with pretty much every developer that starts as a multiplatform producer. Think EA, ubisoft, square, etc. That will assuredly happen. So there will be a cost involved....but again...they will be fine. They will still make a ton of money.

 

[Olikan]

Again, the profit level that microsoft or sony make have NO BEARING on what component cost manufacturers get. As you can see from the figures above, nvidia made quite a profit in 2001 with the original xbox. 200 million and that doesn't even include per chip costs. So there is money to be made, nvidia is just playing the PR game by stating they didn't want to be in PS4 - they hired the former contract negotiator from AMD that handled their console division. Now why would they do that if they, "didn't care". Give me a break. Of course they care, because consoles influence everything in the gaming industry, even PCs - if nvidia loses influence with consoles they will lose influence with PC game developers as well to a certain extent.

...you just won the thread
heheh, i barely remember that

 

[Imouto]

You don't need your hardware to be profitable. Just look at Amazon selling Kindles like cookies, losing money with every single unit.

 

[vampirr]

I think guys from Nvidia fell butthurt since Sony declined their offers, AMD won and now they bitch about it that is not profitable or all other BS that I is seen numerous times...

Nvidia has dropped the ball, move on. AMD rules this console generation...

 

[blackened23]

...you just won the thread
heheh, i barely remember that

http://www.theverge.com/2012/7/24/3180484/amd-bob-feldstein-xbox-720-ps4-wii-u-hired-nvidia

You know, I'm kind of jealous of the guy. He was hired by nvidia for an undoubtedly huge salary, has a comfortable office and great benefits to do nothing. Head of the console division, but hey nvidia doesn't care guys. So just sit here doing nothing to earn money. We don't care. We let AMD have it. We hired you for no particular reason other than a stellar personality. Although he was critical to getting ATI parts in prior consoles and was pivotal in those discussions, we don't care. Let AMD have it please.

Definitely jealous.

 

[cplusplus]

This. Sony just brought out an even lower cost version of the PS3, and they could still shrink the Cell again to get production costs down. They could sell bargain basement PS3s for years to come, and turn a profit on every one.

And that's not even to mention the fact that the digital storefront means they can make more money per game than before, and that they don't really need the shelf space anymore to sell games (which is the one of the biggest things you lose when transitioning generations, stores just don't stock as much product and dedicate less space to it).

If I were to buy a PS2 last year, Sony would make a little money on the sale of the system, but almost none on software since most of the games you'd be able to purchase would either be used or so old that they aren't going to be restocked if they sell out. If you buy a PS3 a couple years from now, you'll probably be buying a lot of your games digitally, so they'll still be getting their cut of that, in addition to the profit on hardware and accessories. This is what the 10 year lifecycle for Sony consoles means.

 

[cplusplus]

http://www.theverge.com/2012/7/24/3180484/amd-bob-feldstein-xbox-720-ps4-wii-u-hired-nvidia

You know, I'm kind of jealous of the guy. He was hired by nvidia for an undoubtedly huge salary, has a comfortable office and great benefits to do nothing. Head of the console division, but hey nvidia doesn't care guys. So just sit here doing nothing to earn money. We don't care. We let AMD have it. We hired you for no particular reason other than a stellar personality. Although he was critical to getting ATI parts in prior consoles and was pivotal in those discussions, we don't care. Let AMD have it please.

Definitely jealous.

I'm sure he's having as many conversations as he can with Valve right now about what they're going to put in the official Steambox.

 

[blackened23]

I'm sure he's having as many conversations as he can with Valve right now about what they're going to put in the official Steambox.

That's definitely a big possibility. It'll be interesting to see what price level the steambox targets, I wasn't too impressed by the XI3 variants - although that isn't the true steam box.

 

[ikachu]

I'm sure he's having as many conversations as he can with Valve right now about what they're going to put in the official Steambox.

Hm? He's probably only having conversations with his lawyer right about now...
http://www.theverge.com/2013/1/16/3881826/amd-accuses-bob-feldstein-of-stealing-documents-nvidia

 

[The Alias]

Hm? He's probably only having conversations with his lawyer right about now...
http://www.theverge.com/2013/1/16/3881826/amd-accuses-bob-feldstein-of-stealing-documents-nvidia

ooooo I forgot that

 

[vampirr]

Nvidia does not have anything to offer to Sony for a affordable performance like AMD does and AMD's APU's are far more mature than anything that Nvidia has while also APU's are just one part of development of HSA technology for over 7-8 years compared to Tegra that was in development for 5 years...

Because it use some hardware that is not beffy or it is also used in tablets, laptops or notebooks it does not mean it will terrible or a debacle. We are talking about consoles, games on those consoles will use every possible atom they can for their games in next 3 years. On consoles the hardware does not change, no variations...

 

[Fx1]

I'll just post think link Again, since it got ignored the first...this time I will quote it...just for that nice foot-in-mouth feeling, some posters have gotten used too:

http://www.vg247.com/2013/01/07/xbo...-billion-ex-sony-employee-paints-grim-future/

I stopped reading this crap from the "expert" when he said project shield was a real threat to home console gaming.

The thing about the idiots who constantly write about the gaming industry actually know crap all about the gaming industry. In fact the whole industry is full of complete tossers who used to sell baked beans or washing up liquid who now are self professed gaming industry know it alls. They got a job in this industry but they arent gamers.

Its a bit like watching your dad trying to dance to drum and bass or dub step. Its like a car crash in slow motion. Just about every gaming prediction that comes out of these ass holes mouths is wrong. It infuriates me.

 

[3DVagabond]

Intel has not needed to compete with AMD for years, and yet prices on high end SKUs have been flat to down, with increasing performance, higher integration, and decreasing power envelopes. Guys like Intel/AMD/Nvidia rely on people upgrading in order to keep the lights on.

If AMD went bankrupt tomorrow, Intel and Nvidia would keep on plugging on doing what they do.

I think you are being naive. There's a reason that there are laws against monopolies. Competition is a good thing for consumers. If you are a consumer, root for competition instead of a brand.

 

[3DVagabond]

So AMD has entered a unprofitable market....nice ^^

Sony/M$ losing money doesn't mean that their OEM manufacturers lose money. Sony's and M$'s financials are irrelevant to the discussion of whether or not AMD is going to make money on their end.

 

[itsmydamnation]

this thread remind me of

 

[notty22]

http://www.theverge.com/2012/7/24/3180484/amd-bob-feldstein-xbox-720-ps4-wii-u-hired-nvidia

You know, I'm kind of jealous of the guy. He was hired by nvidia for an undoubtedly huge salary, has a comfortable office and great benefits to do nothing. Head of the console division, but hey nvidia doesn't care guys. So just sit here doing nothing to earn money. We don't care. We let AMD have it. We hired you for no particular reason other than a stellar personality. Although he was critical to getting ATI parts in prior consoles and was pivotal in those discussions, we don't care. Let AMD have it please.

Definitely jealous.

You should have hit cancel on this mess. Are you serious. I'm kind of jealous?

 

[blackened23]

this thread remind me of

or this

 

[ShintaiDK]

I don't think this is quite true. First things first, the profit or lack of profit for sony or microsoft has little bearing on the component cost - they will pay that regardless even if it is at a loss. Nvidia received 125$ for the PS3 GPU. We don't know what upfront cost they received - but we do know that they received a 200 million upfront advance, not including per chip costs, for the original xbox. That was in 2001 - such a figure would be far higher currently. As you can see, the component suppliers STILL get a profit regardless of what the profit level of microsoft and sony are.

No, just no.

nVidia sold a design to Sony that got manufactored by Sony whereever they wished. Its simply not true nVidia got 125$ per GPU. Plus the 125$ is simply an estimate for what the cost for Sony is to have it manufactored. 30$ on the GPU also comes from Samsung via integrated parts into the GPU if you read the isuppli report.

People also forget the Xbox360 20GB actually sold with an estimated profit. Yet MS couldnt make any money. Both MS and Sony was also plagued by high RMA rates.

 

[veri745]

Of course Nvidia, who didn't get into any of the next gen consoles, are going to say to people, "It's not that big of a deal."

You really think they'd come out and say, "Man that sucks, we really screwed that one up and it's going to cost us $200/500/700M per year."?

 

[AnandThenMan]

Nvidia at one time was also poo-pooing DX11 because they didn't have it.

 

[DooKey]

I see the video card company defenders are still going at it. LOL.