Nvidia aims at Intel with integrated graphics chip

An undated file photo of a laptop featuring Nvidia's PureVideo technology. Nvidia Corp is rolling out a graphics microchip that will be embedded in the main collection of components that make up a personal computer, as the company goes toe to toe with Intel Corp in the integrated graphics chip market.

SAN FRANCISCO (Reuters) - Nvidia Corp (NVDA.O) is rolling out a graphics microchip that will be embedded in the main collection of components that make up a personal computer, as the company goes toe to toe with Intel Corp (INTC.O) in the integrated graphics chip market.

Nvidia is expected to say on Tuesday that its new GeForce chips for desktop PCs give the performance of an entry-level separate graphics processor unit, as compared to traditional integrated graphics chips such as those made by Intel.

Given the proliferation of graphically rich computer programs, Nvidia, Intel, Advanced Micro Devices Inc (AMD.N) and others aim to provide better graphics performance. Intel, the world's biggest chipmaker, has already upgraded its integrated graphics offering, the G35, aimed at mainstream PCs.

"As for going up against a strong competitor, that's nothing for Nvidia," said Jon Peddie, head of market research firm Jon Peddie Research, based in Tiburon, California. "They've got great technology and superior marketing skills."

Traditionally, at the high end of the PC market -- such as for video game enthusiasts -- the graphics chip is a separate processor that connects to the motherboard, the guts of a computer, to give rich, crisp graphics performance.

Nvidia already has 62 percent of the market for integrated graphics on motherboards used in PCs powered by AMD processors, according to Mercury research. But its market share on motherboards in Intel-powered PCs is less than 1 percent.

"Nvidia has been extremely successful in providing integrated graphics, particularly for the AMD platform," Peddie said, noting AMD's platform has 5 percent to 10 percent of the desktop market, leaving nearly all the rest to Intel. "This move by Nvidia gives them a pretty big market potential."

Santa Clara, California-based Nvidia said its GeForce 7150, 7100 and 7050 chips will support the Intel desktop PC processor range, such as Core 2, Pentium and Celeron, as well as new Intel processors due to launch on November 12, code-named Penryn. The Nvidia chips are aimed at desktops priced at $400 to $600.

With graphics-intensive programs such as Google Earth from Google Inc (GOOG.O), three-dimensional graphics now built into Apple Inc's (AAPL.O) iTunes, and increasingly graphics-heavy programs like Adobe Acrobat, both PC makers and chip makers are racing to offer good graphics at cheaper prices, Peddie said.

AMD, for its part, bought Canadian graphics chipmaker ATI, Nvidia's principal rival, and PC makers Hewlett-Packard Co (HPQ.N) and Dell Inc (DELL.O) each bought high-end video game PC makers Alienware and Voodoo, respectively.

Just last week, Intel said it bought privately held Irish company Havok Inc, best known for technology to render physics in video games and films, such as for the depiction of billowing smoke and dust in explosions.