Speeds and Feeds

I spent Tuesday at Nvidia headquarters, attending the company's annual Analyst Day.

I've been to most of Nvidia's analyst events over the last decade or so, since I covered Nvidia almost from its inception while working as the graphics analyst at Microprocessor Report. These meetings are always a good way to get an update on the company's business operations, and sometimes--like this time--one provides exceptionally good insight into larger industry trends.

Nvidia's GeForce GTX 280 graphics chip

(Credit: Nvidia)

Nvidia has had a rough couple of quarters in the market, which CEO Jen-Hsun Huang blamed in part on a bad strategic call in early 2008: to place orders for large quantities of new chips to be delivered later in the year. When the recession hit, these orders turned into about six months of inventory, much of which simply couldn't be sold at the usual markup.

In response, Nvidia CFO David White outlined measures the company plans to take to increase revenue, sell a more valuable mix of products, reduce the cost of goods sold, and cut back on Nvidia's operating expenses.

Three things stood out for me in this presentation:

Nvidia is planning an aggressive transition to state-of-the-art ASIC fabrication technology at TSMC, the company's manufacturing partner. Within "two to three quarters," White said, about two-thirds of the chips Nvidia sells will be made using 40-nanometer process technology. (The first of these chips were announced Tuesday.)

White also acknowledged something that I've long assumed to be true: Nvidia receives "preferential allocation" on advanced process technology at TSMC. It's logical that Nvidia should get the red-carpet treatment, having been TSMC's best customer for many years, but I don't recall hearing Nvidia or TSMC put this fact on the record before.

The third notable point from White's presentation: the gross margins for Nvidia's Tegra, an ARM-based application processor--which Nvidia's Mike Rayfield, general manager of the Tegra division, says has already garnered 42 design wins at 27 companies--are much higher than I'd have guessed--at "over 45 percent." That's quite excellent for an ARM-based SoC; it's a very competitive market.

More surprises
The technical sessions at the event contained their own surprises.

For example, Nvidia effectively seized control of an old Intel marketing buzzword: "balanced."

For years, Intel used to talk about ... Read more

I honestly don't know whether Om Malik's blog site, GigaOM, is intended to be informative or merely entertaining. I pointed out a previous example of the overwrought rhetoric that permeates that site last September (in the context of Comcast's then-new usage cap policy), but generally, I try to ignore the nonsense there for the same reasons that I ignore talk radio.

But like it or not, GigaOM is widely read, and sometimes when a post there bears directly on a market that's important to me, I can't bear to let it go. This is one of those times.

On Thursday, a GigaOM staffer wrote a piece titled "Can Intel Thrive in a Post x86 World?"

A slide from Fred Weber's keynote presentation at Microprocessor Forum 2003 showing how x86 will evolve into systems from big servers down to handheld consumer devices.

(Credit: Advanced Micro Devices, Inc.)

The headline is preposterous from beginning to end. It has two implications just in the eight words of the title: that Intel's ability to "thrive" faces any imminent threats, and that the importance of the x86 architecture is declining.

In January, the same staffer wrote a piece titled "Netbooks and the Death of x86 Computing" which reached the fantastic conclusion that Netbooks would "destroy the hegemony of x86 machines for personal computing."

Well, as I pointed out just a few weeks later (in "The Netbook is dead. Long live the notebook!"), when the Netbook phenomenon ran up against the dominance of Intel and Microsoft in the PC market, it was the Netbook that died instead. Even at a $300 price point, people still want full PC compatibility.

Yes, there are companies like Freescale (the subject of the January post on GigaOM) and Nvidia that are looking to push the ARM architecture into the Netbook space. But that idea never made much sense, and now that Intel and TSMC are working together to get Intel's Atom x86 core into lower-cost SoC (system on chip) products, the ARM architecture will eventually have to retreat into the shrinking niche for supersmall, supercheap phones and consumer electronics gizmos for which x86 compatibility is of negligible value.

See, we learned a long time ago--those of us who cover this industry professionally, not just as a random assignment for some random blog--that the instruction set architecture (ISA), per se, doesn't matter any more.

The choice of ISA was a big deal in the 1980s and early 1990s, when the extra complexity of an x86 instruction decoder was a large fraction of the total complexity of a microprocessor. That's where the conflict between RISC and CISC came from.

But by the turn of the century, ISA complexity was almost a dead issue, and that coffin's final nail was pounded in by the keynote speech of then-Advanced Micro Devices CTO Fred Weber at Microprocessor Forum 2003, an event I had the honor of hosting.

In his talk, "Towards Instruction Set Consolidation," Weber made a simple point: "Technology has passed the point where instruction set costs are at all relevant."

Even then, three generations of process technology ago, the "x86 penalty" was down to a couple square millimeters of silicon. Today, the comparable figure is about 0.25 square millimeters. Not zero, certainly, but not a significant concern for chips that are a hundred times larger.

In short, ARM chips aren't cheaper or more power-efficient because of their instruction sets; they're like that because they're designed to be. And anything that an ARM chip can do to save cost or power can also be done by an x86 chip.

So there can't ever be a time when the world moves beyond x86. That's 1980s thinking, just plain ignorance of what may be the most important trend in the microprocessor industry.

The rest of Thursday's GigaOM post is a hopelessly self-contradictory muddle that fails to reach any clear conclusions. I'll just quote one more line near the end: "But the PC will be just one small (and shrinking) battleground to keep x86 relevant, amid a more mobile, visual, and power-sensitive world."

Current economic woes aside, the PC market is hardly shrinking. You know what's shrinking? The PC! As the PC shrinks, the PC market will grow. The MID (mobile Internet device) market isn't much to speak of right now, for example, but once MID makers figure out what to build, MIDs will become more popular.

And seriously, is anyone really not clear on the fact that the Apple iPhone is a computer? It isn't an embedded system. An embedded system is one in which the presence of a microprocessor is functionally irrelevant to the user. When a gizmo exposes its programmability to the user, it's a computer.

What else is the App Store but the visible manifestation of the iPhone's programmability?

Now, ARM isn't dead yet. The iPhone uses an ARM processor because there's no x86 processor that would work as well in that system. ARM processors will probably see at least two more generations in cell phones just because there's so much ARM-based software out there (including all the software on the App Store).

But somewhere around 2012, we're going to see x86 chips poking into that space. The value of instruction set compatibility with the PC market will persuade developers of new cell phone platforms to go with x86 chips, and eventually even established systems like the iPhone will switch over.

So not only are x86 chips selling into a growing PC market, they'll eventually start eating into ARM's own strongholds. That can't be bad for Intel.

And that's why the GigaOM piece was preposterous.

I received an interesting e-mail from a reader over the weekend. Dr. Katherine Gold, a lecturer with the Department of Family Medicine at the University of Michigan, had some questions related to Netbooks (or small notebooks), broadband Internet access, and physical computer security. After some discussion, Dr. Gold and I decided to see if some of you might be able to help answer her questions.

Here's the situation: Dr. Gold is setting up a research project to investigate the benefits of online support groups for low- income women in the Detroit area who have recently suffered the loss of a stillborn child.

Most women benefit from such services, but they tend to be less available to the poor for because they are less likely to have computers and Internet access. Also, these women often have other children to care for, jobs to hold down, and limited transportation options, so they may not be able to take full advantage of Internet access at public libraries or other facilities.

In Dr. Gold's experience, the greatest need for support often comes at night, when such facilities aren't open, anyway.

The bottom line here is that Dr. Gold wants to supply her participants with computers they can keep at home for the duration of the study, along with some kind of Internet connection.

There are several key challenges for this approach: cost, convenience, theft resistance, ease of use, maintenance, and so on.

Dr. Gold and I agree that a Netbook--the original concept of a Netbook, a machine no larger or more expensive than necessary to provide basic Internet access--would provide a good platform for this application. A properly selected and preconfigured system would provide the necessary functionality at minimum cost. A Netbook is both less attractive to burglars and easier to secure than a desktop PC with a separate display and keyboard.

The Acer Aspire One is a small but complete notebook computer.

(Credit: Acer)

In fact, when Dr. Gold wrote to me originally, she had already identified what I think is probably the most appropriate off-the-shelf solution: the $99 special offer from Radio Shack for an Acer Aspire One with built-in wireless broadband and Wi-Fi connectivity.

The only drawback to this offer is that it requires a two-year commitment to a $60-per-month AT&T wireless data contract, which adds up to another $1,440 on top of that $99 retail price. That's a lot of money for a study like this, especially when it's scheduled to last only one year.

Dial-up access would be cheaper, but it would preclude testing the therapeutic value of high-bandwidth Internet services such as videoconferencing and would likely interfere with ordinary telephone usage, which makes it a nonstarter in many households.

Dr. Gold provided some statistics on the stillbirth problem: it's 10 = times more common than Sudden Infant Death Syndrome (SIDS), involved in 1 in 100 births in the Detroit area. As one might expect, stillbirth leads to much higher rates of depression and anxiety disorders compared to live birth, and these problems have significant social costs.

Stillbirth is three times more common among African- Americans in Detroit than among whites there, explaining the special value of extending Internet-based therapy to lower-income women.

I suggested that a corporate sponsor might be willing to help defray the costs of the hardware and Internet access, and that was one of the considerations that led us to this post. It seems to me that a study like this could help demonstrate that the value of small notebooks goes well beyond students, and the value of wireless broadband goes well beyond business travelers.

I'd also like to draw attention to something that's always been obvious to me: "rugged" is the corollary to "small."

Smaller notebooks are more likely to be carried around, particularly without the protection offered by a briefcase or backpack, so they ought to be more rugged as well. There are a lot of low-cost small notebooks out there, but there are few, if any, low-cost rugged models.

Ruggedness lends itself to theft resistance as well; the traditional Kensington security slot is less effective on a machine with a flimsy plastic case and a lightweight internal metal frame.

Another thing we'd like to hear about from you folks out there--have you had any experiences with Internet-based theft deterrence and recovery services such as Computrace LoJack for Laptops? Such a service could be a helpful addition to this study and similar applications.

Feel free to comment below, or write directly to me and Dr. Gold. (Addresses obfuscated a little to deter spam.)

I'll post updates as Dr. Gold's project moves along.

Much coverage of this year's Consumer Electronics Show is full of references to new Netbooks introduced at the show. But in fact, there were hardly any Netbooks at all, and those that did appear went almost unmentioned.

The truth is, the Netbook is dead, and good riddance. The concept of the Netbook was based on a tragic misunderstanding: the belief that tens, perhaps hundreds of millions of people worldwide wanted a portable computer that was small, power-efficient, and (here's the misunderstanding) not good for much beyond accessing the Internet.

Asus's Eee PC T91 convertible tablet

(Credit: ASUSTeK Computer Inc.)

That's where the "Net" in "Netbook" came from: the Web, e-mail, chat, maybe some VoIP (voice over Internet Protocol communications).

That's what the earliest Netbooks delivered, too--machines like the Eee PC 701 from Asus (which I described here) that came with slow single-core processors, small amounts of RAM, small liquid crystal displays, and tiny, slow flash drives. They were good enough for light Web browsing and e-mail--and not much more. They wouldn't run Windows XP with acceptable performance, never mind Windows Vista.

Well, nobody wanted those machines. Companies that tried to sell them saw unprecedented return rates. Asus, for its part, couldn't upgrade the Eee PC fast enough; current Eee PCs have faster processors, more memory, larger screens, and larger flash drives or real rotating hard disks.

At CES, Asus expanded its line of Eee PC systems to include the S101, S101H, 701, 701SD, 701SDX, 900, 900A, 900HA, 900HD, 900SD, 901, 901XP, 904HA, 904HD, 1000, 1000H, 1000HA, 1000HD, 1000HE, 1000HG, 1002HA, 1003HG, and 1004DN laptops; the T91 and T101H tablets; and multiple Eee Top desktops. (Seriously! Most of these model numbers are on Asus's Eee PC site; the others are from CES. And I may have missed some.)

Certainly, all of these Eee PC systems were clearly distinct from Asus' mainstream offerings: Celeron or (mostly) Atom processors, 10-inch or smaller displays (on the laptops), and smaller amounts of RAM and mass storage.

But the fact is, they're all capable of much more than simple Web browsing. Asus specifically promotes the use of Windows XP Home with all of these machines, and it looks like they'd all run Vista as well, though perhaps without all the visual bells and whistles.

You wouldn't buy these machines to run Photoshop, edit high-definition videos, or play 3D games, but for most simpler purposes, they'd be fine.

In fact, as a cross-platform kind of guy myself, I'm thinking about getting one of those T91 tablets, when they go on the market later this year. I used to use a Motion tablet for meeting notes (with Microsoft Office OneNote, a great package) and PowerPoint presentations at Montalvo Systems, and I'd really like to do that again.

Small-screen laptops over the years. Foreground: a TRS-80 Model 100 (1983); rear, from left: an Apple PowerBook Duo 270c (1993), a Dauphin DTR-1 pen computer (1993), and an Asus Eee PC 701 (2007). From the author's collection.

(Credit: Peter N. Glaskowsky)

So what's left of the Netbook concept? Small displays? C'mon, we've had small displays since the dawn of mobile computing. There hasn't been a day since 1983 when you couldn't get a laptop with a small display.

So these new machines aren't merely Netbooks that are "evolving" or "overachieving". They're notebooks. And Moore's Law will ensure that these systems will eventually suffice for any fixed workload. (3D games get more demanding each year, so small notebooks will always be inadequate for bleeding-edge gaming.)

Actually, there were some true Netbooks at CES. What distinguished them from these other machines, which were merely called Netbooks?

Well, today, if you want to make a subnote with a few hundred MHz of processor power and really basic 2D/3D graphics, an x86 processor and chipset is the expensive way to get it. It's better to start with an ARM processor. Some of those are single chips with almost everything you need except RAM, and they'll save you up to $50 off the x86 alternatives.

Such Netbooks have been announced by several companies, including Pegatron, and LimePC. There's nothing wrong with these machines. I'm sure they'll do everything they're advertised to do.

But this still brings us back to that tragic misunderstanding: few people will buy an ARM-based Netbook priced at $199 to $299 when there are good x86-based notebooks starting at less than $400. Certainly not when the x86 machines can run Windows or a mainstream Linux distribution, provide far more CPU and GPU performance, and come in the same small sizes.

So that's that. The Netbook is dead. Long live the notebook.