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Nvidia's (NVDA) next-generation Tegra processor will be a quad-core ARM Cortex-A15 processor with 72 graphics cores. The company says the Tegra 4 will be the first quad-core chip based on ARM's most powerful design. Nvidia's Tegra 4 is the world's fastest mobile processor, according to the company. The rivals disagree. Qualcomm (QCOM) has pointed out that Tegra 4 would easily be beaten by its snapdragon 800 expected to be released soon. The chip according to critics is big leap forward from the Tegra 3 at least in terms of theoretical speed and performance. The point has also been made by a report issued by Microprocessor arguing the fact that in terms of speed and performance Tegra 4 outclasses Qualcomm's Snapdragon 800 by a fair margin. Although Snapdragon 800 is better with respect to power efficiency and it is precisely this efficiency edge that may challenge Tegra 4's inclusion in Smartphones.

Industry dynamics

The chip manufacturing industry is highly competitive and is marked by rapid technology change, constantly evolving industry standards and declining average selling prices. A number of competitive factors are simultaneously at play including performance, variety of product offering, access to customers, software support (after sales services), manufacturing capabilities and total processor pricing to highlight a few.

Challenges

Nvidia faces an uphill task in convincing Smartphone and tablet makers to integrate its Tegra 4 in their devices. Most of the OEM's (Acer, Samsung and Asus) are not impressed and are unwilling to integrate the super processor in their smartphones and tablets. Much of that blame lies with Tegra 3's incompatibly since it required a separate cellular radio. The chip only made it to HTC X+ but was not integrated in any of the top Smartphones last year. A major hurdle for Nvidia is that it did not have the iPhone 5 and Galaxy S3 as to tap into the Smartphone market. With Tegra 4 to be launched soon Nvidia must make sure that it convinces the top of the line Smartphone manufacturers to integrate their chip, otherwise the prospects aren't that bright.

Experts point out that it's because Tegra only recently started packing cellular connectivity into the system with Tegra 4 while Qualcomm has been tried and tested with regard to its cellular radio technology. Underperforming and power-hungry Tegra 3 made a very unimpressive run with OEM's and Nvidia would have to do a lot of convincing to market its upcoming Tegra 4. The lack of interest in Tegra 4 could also be because of its lack of support for APIs such as DirectX, OpenCL, and OpenGL, which would augment difficulty relating to cross platform development of graphic intensive software.

Way forward

Nvidia has taken steps to increase compatibility of Tegra 3 by integrating baseline LTE. It may have the compatibility but would be void of the massive processing power generated by the new Tegra 4. But the question remains that with the smartphone market already heavily monopolized by Qualcomm's Snapdragon, Samsung's (SSNLF.PK) Exynos and Apple's (AAPL) A-family; will Nvidia be able to penetrate with its newest and fastest ARM processor. Maybe, but it will definitely be an uphill task for Jen Hsun Huang.

On the upside, Tegra 4, according to experts, will attract the tablet market which has grown considerably over the last couple of years, especially cannibalizing the PC for some time now. The increased speed (compromising on poor efficiency) will fare well if Nvidia was to Target the tablet market more aggressively instead of the smartphone market. The incompatibly of Tegra 3 with Smartphone OEM's will hamper the reputation of Tegra 4 immensely. It has already shown up in a number of tablets including Asus, Acer and Microsoft. Nvidia has historically focused on visual graphics but with the slowdown in the PC market, the company has shifted its emphasis to broaden consumer base and capture a piece of the smartphone and tablet market.

Conclusion

As pointed out by Nvidia's CEO, Tegra is more than just penetrating into the smartphone market, it is the future of the company and Nvidia is betting heavily on it. Although on the surface of it, Tegra 4 is a much superior alternative to the Qualcomm's Snapdragon 800 but its lack of power efficiency would be a major deterrent for OEM's to integrate the chip on their devices, a major downside. This, especially since consumers are weighing power drain as a major problem in Smartphone usage experience. The competition is stiff and Nvidia would have to go all guns blazing to make a marked impact on its market share in the smartphones segment.

Source: Nvidia: What To Expect From Tegra 4