) could be on the cusp of securing an order for several million
additional processors. According to
, Asus (the company that manufactured the original Nexus 7) will
replace NVIDIA's (NASDAQ:
) Tegra 3 with an unnamed processor from Qualcomm.
This is surprising news considering the fanfare behind the
Tegra 3 in 2012 and the anticipation for its follow-up, the Tegra
4. Numerous tablets incorporated the Tegra 3 last year, including
the original Nexus 7, Sony's (NYSE:
) Xperia Tablet S and Microsoft's (NASDAQ:
) Surface RT.
While it is not yet known if Sony will release a new tablet in
2013, Microsoft is
to switch from NVIDIA to Qualcomm for Surface 2.
) has not released any sales data for the original Nexus 7, nor
has it revealed how many tablets it expects to sell in 2013.
However, upstream supply chain sources told DigiTimes that if
NVIDIA fails to secure the Nexus 7 contract, it could lose an
order of roughly eight million processors.
NVIDIA reportedly shipped more than 10 million Tegra 3
processors for tablets last year. Sixty percent of them were
assigned to the Nexus 7; the rest were supplied to Lenovo, Acer
and various white-box players in China.
This is not the first time NVIDIA has taken a backseat to its
competitors. Nintendo (OTC:
) and Sony chose Advanced Micro Devices (NYSE:
) to power the next-generation consoles. Microsoft is
to do the same.
When questioned about a potential contract with Sony, NVIDIA's
Tony Tamasi acted as though it was the company's choice to get
out of the console manufacturing business.
"I'm sure there was a negotiation that went on," Tamasi, who
serves as NVIDIA's Senior VP of Content and Technology, told
. "And we came to the conclusion that we didn't want to do the
business at the price those guys were willing to pay.
"Having been through the original Xbox and PS3, we understand
the economics of [console development] and the tradeoffs."
Thus far, very few manufacturers have publicly stated that
they will use the Tegra 4 processor. Chinese handset maker ZTE is
already signed up
, but Hewlett-Packard (NYSE:
to be developing a tablet that will also use Tegra 4. However,
HP's first Android-based tablet, the Slate 7, is using a
processor from ARM Holdings (NASDAQ:
Louis Bedigian is the Senior Tech Analyst and Features Writer
of Benzinga. You can reach him at 248-636-1322 or
firstname.lastname@example.org. Follow him
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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