AMD Is Losing the Graphics Market

AMD looks like it is having a really, really bad year both on the processor and on the graphics markets. First of all, on the processor market it lost ground and market shares to the giant Intel and as the price wars become fiercer, it lost a bunch of money too. On the graphics chips market, AMD must battle another well-known and established competitor: Nvidia. And it seems that its competitor is rolling over it because of a much more aggressive marketing strategy, a line of video chips that hit the market sooner than expected and a better overall driver suite (I personally like ATI based video cards, but their drivers are the bottom line, even more when we are talking Linux based ones).

On the other side of the fence, Nvidia is doing well despite a number of concerns earlier this year when AMD merged with ATI. Some thought that would be the end for Nvidia and that the combined power of the two merged hardware companies (AMD and ATI) will force Nvidia to seek out an alliance with Intel. But all concerns were for nothing as now, "in terms of market penetration, the integration of its main rival into AMD has not hurt Nvidia at all", according to the news site TGDaily. A report released by Jon Peddie Research and cited by the above mentioned site says that "ATI is estimated to have reached a market share of 19.5% in the second quarter of this year, down from 21.9% in Q1 and down from 26.7% one year ago", while Nvidia rose from "32.6%, up from 28.5% in Q1 and up from 19.7% last year".

When talking about absolute numbers or units shipped, AMD lost a lot of ground, dropping from 19.7 million graphics cards to 15.9 million units in the second quarter of the year 2007, while during the same timeframe its rival increased its shipments by 83 percent reaching an impressive 26.5 million units. Nvidia's advantage is more prominent on the desktop discrete graphics cards where it has the biggest market share (43 percent) and being followed by Intel with 38.5 percent, while AMD is the last with only 23 percent.