Nvidia’s CEO Jen-Hsun Huang has revealed that the company will begin licensing its popular graphics technology to other companies, opening up a new revenue stream.
Speaking at the Reuters Global Technology Summit in San Francisco, Huang unveiled plans to license its graphics cores and visual patents to the smartphone and tablet markets, which it has significantly less of a foothold in than the PC and laptop markets. It has previously been attempting to gain market share with its Tegra range.
“The bottom line is the world has changed and we’re expanding our business model to serve markets that we historically could not serve by selling chips alone,” Huang told Reuters.
The two major players in the mobile market, Samsung and Apple, already make their own processors, while Qualcomm’s processors are employed by many other rivals. Cambridge-based ARM has also been growing its market share.
Nvidia has a powerful brand, however, which could particularly appeal to those wanting tablet computers for gaming. It will begin by licensing its Kepler architecture, which it currently uses for high-end graphics cards for PCs.
Top mobile firms will likely be keen to cash in on the Nvidia name, but Huang was evasive when questioned if the company hopes to license its technology to Samsung and Apple.
Huang said he expects the future of Nvidia to be “increasingly hybrid,” with a mixture of direct GPU sales and licensing, but he added that licensing revenue would trail chip sales for some time. He cited Microsoft as a good example of the hybrid model and suggested more companies will suit.Leave a comment on this article