CES Day One: Nvidia’s Bombshell

by Brad Moon | January 8, 2013 10:59 am

Monday was the day for big companies at the annual Consumer Electronics Show (CES) to hold press conferences announcing the latest new gear they’re aiming to get you to buy in 2013.

If you were in Las Vegas yesterday, you may well have heard “Where the hell did that come from?” echoing in the streets from Sony (NYSE:SNE[1]), Nintendo (PINK:NTDOY[2]) and Microsoft (NASDAQ:MSFT[3]) execs wondering what hit them after Nvidia (NASDAQ:NVDA[4]) dropped the first bombshell of the conference. It may also have come from the journalists wondering what Samsung designers were thinking when they came up with the stand for the South Korean manufacturer’s new Ultra HDTV, the world’s biggest.

As expected, TVs were front and center. Manufacturers such as Sony, Sharp (PINK:SHCAY[5]) and Panasonic (NASDAQ:PC[6]) all reported steep losses for the year[7], blamed largely on their TV divisions. Panasonic stock took a 19% dive in October[8] on news of a near $9 billion quarterly loss — one of the largest ever for a Japanese company.

With consumers reluctant to upgrade their current flat-screen TVs combined with downward price pressure, TV makers needed to bring their “A game” to CES in hopes that 2013 will be the year they make the sale.

The primary tricks manufacturers are trotting out are size (the bigger, the better), resolution (the more, the better) and connectivity (the smarter, the better). Previous CES darling 3D is hardly getting mentioned, given the resounding “meh” from consumers, who now expect it as a standard feature.

Here are some highlights of Monday’s press conferences:






However, Nvidia has stolen the show so far in terms of bombshell announcements. It introduced a new Tegra 4 mobile processor, a model it claims to be the world’s fastest mobile CPU (a quad-core chip with 72 GPU cores and 4G LTE support), along with a new GRID gaming system. It’s essentially a cloud-based service consisting of rack-mounted servers packed full of GPUs for heavy-duty graphical processing.

All this is interesting enough, and smartphone/tablet manufacturers are expected to start adopting that powerful Tegra processor. The bombshell part was the unveiling of “Project Shield,” a Tegra 4-powered portable gaming system that Nvidia secretly developed. This an Android-powered device with a 5-inch, 720p display, full controller, the ability to play both Android and PC games (via Steam) and HD video output for connecting to a big, flat-screen TV. (Shield image courtesy of Extremetech.com.)


Android games are a bit of a yawner, but the ability to play PC games is a Holy Grail among console makers, and doing so on portable hardware was pretty much inconceivable.

Out of the blue, Nvidia has a completely new player and with the possibility of leveraging a huge catalog of existing games. That’s disruptive.

Pricing and other details are short, but if Nvidia’s Shield has legs, it will make things even tougher for video-game consoles and especially for Sony and Nintendo, which are already fighting casual mobile gaming’s effect[15] on their struggling portable consoles.

After spiking in anticipation of CES reveals, Nvidia’s stock fell nearly 3% Monday on the news, so it would appear that not everyone is convinced the company can pull this off.

Stay tuned for Day Two …

As of this writing, Brad Moon didn’t own any securities mentioned here.

  1. SNE: http://studio-5.financialcontent.com/investplace/quote?Symbol=SNE
  2. NTDOY: http://studio-5.financialcontent.com/investplace/quote?Symbol=NTDOY
  3. MSFT: http://studio-5.financialcontent.com/investplace/quote?Symbol=MSFT
  4. NVDA: http://studio-5.financialcontent.com/investplace/quote?Symbol=NVDA
  5. SHCAY: http://studio-5.financialcontent.com/investplace/quote?Symbol=SHCAY
  6. PC: http://studio-5.financialcontent.com/investplace/quote?Symbol=PC
  7. all reported steep losses for the year: http://www.eetimes.com/electronics-news/4373507/Will-Japan--Inc--say-Sayonara-to-TV-manufacture-
  8. Panasonic stock took a 19% dive in October: http://online.wsj.com/article/SB10001424052970204712904578089962887027962.html
  9. [Image]: https://investorplace.com/wp-content/uploads/2013/01/Moon-Samsung-TV1.png
  10. AAPL: http://studio-5.financialcontent.com/investplace/quote?Symbol=AAPL
  11. HSN: http://studio-5.financialcontent.com/investplace/quote?Symbol=HSN
  12. GOOG: http://studio-5.financialcontent.com/investplace/quote?Symbol=GOOG
  13. No Sony Wallet yet: https://investorplace.com/2012/09/wheres-the-iphone-5s-iwallet/
  14. [Image]: https://investorplace.com/wp-content/uploads/2013/01/Moon-Nvidia.png
  15. fighting casual mobile gaming’s effect: http://slant.investorplace.com/2012/10/video-game-sales-nintendo-erts-znga/

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