Entering text into the input field will update the search result below

Why Nvidia's GeForce Partner Program Saw A Quick Demise

May 07, 2018 10:22 PM ETNVIDIA Corporation (NVDA)AMD, ASUUY, INTC112 Comments
Motek Moyen profile picture
Motek Moyen


  • Nvidia canceled its GeForce Partner Program or GPP. GPP was Nvidia’s effort to persuade top equipment manufacturers to exclusively use GeForce video cards on their high-end PC gaming products.
  • Some people accused GPP as a Ngreedia move after top PC vendor Asus unveiled its new Arez brand of AMD Radeon GPU-using gaming PCs.
  • Asus’ original high-end gaming brand was Republic of Gamers [ROG]. Asus did not hesitate joining the GPP program.
  • I suspect Intel was behind HP and Dell’s reported objection to Nvidia’s GeForce Partner Program. Intel’s nascent GPU chip collaboration with AMD will die quickly from GPP.
  • The other problem was other OEMs do not want to spend their own money to promote/develop a new brand for Radeon-using computers or discrete video cards.

The gaming segment generates the majority of Nvidia’s (NASDAQ:NVDA) revenue (59.74% as of Q4 2017). I was upset with Nvidia’s hasty cancellation of its GeForce Partner Program [GPP]. Nvidia only unveiled its GeForce Partner Program two months ago. It was the company’s attempt to persuade vendors of PCs and add-in boards to exclusively use GeForce video cards on their brands of high-end PC gaming products.

(Source: Nvidia)

Unfortunately, misinformation that GPP was anti-competitive and a strong-arm tactic compelled Nvidia to prematurely abort it. Bad propaganda killed what could have reinforced Nvidia’s leadership in high-end gaming graphics accelerators.

Nvidia ended 2017 with around 66.3% of the discrete GPU market. Nvidia only wanted to preserve its big lead in discrete GPUs through the GeForce Partner Program. Advanced Micro Devices (AMD) took market share in Q4 2017. From just 29.5% in Q4 2016, AMD’s share in discrete GPUs in Q4 2017 rose to 33.7%.

Leaders Have The Right To Protect Their Moat

My takeaway is that Nvidia was only trying to protect its lead over AMD. Legal threats about anti-trust or monopolistic tactics do not apply here. The GeForce Partner Program was not a compulsory thing or a move against PC and GPU vendors. Third-party companies were free to sign up or ignore it. Fears that Nvidia might not supply (or restrict shipments) GeForce GPU chips (or withhold Marketing Development Funds [MDF]) to vendors who do not sign up were unfounded.

MDF is the incentives/assistance that companies extend to their sales channel partners. It could be financial or in-kind sort of help. PC vendors often compete under low operating margins. They obviously need marketing development funds from chip/processor makers like Nvidia. An example of MDF is for Nvidia to help cover the overhead costs of promoting a brand new high-end gaming PC using GeForce GPU via paid

This article was written by

Motek Moyen profile picture
Motek Moyen is a financial analyst, technician, and Adobe multimedia content creator. He studied Mathematics, Commercial Advertising, and Computer Science in the 1990s. He does not trade stocks.

Analyst’s Disclosure: I am/we are long NVDA, INTC, AMD, LNVGY HPQ. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.