Shortage of Nintendo 64s and Options for Board Companies

(This column first appeared in the September 17, 1996 issue of PC Graphics Report)

After preparing a story on Nintendo’s dire warning about the impending shortage of Nintendo 64, I decided I needed to do some serious research and verify their concerns, as well as check out the system. After all, the entire world of consumer 3D gaming might be jeopardized if not enough people get a chance to play Super Mario 64!

I was concerned that being in New Hampshire might limit my research abilities, but I was pleasantly surprised to find that Toys R’Us was helping out the concerned Nintendo management by pre-selling Nintendo 64 consoles and Super Mario 64. I plunked my $25 deposit down for the console, $15 for Mario 64, and got a free Nintendo T-shirt, tote bag, and tips on how to play Mario 64. Please note, this is all for the sake of research. I plan on getting absolutely no enjoyment out of checking out the N64, I’m just buying it for the articles…er…research.

I’ll provide a complete, objective, serious first look of the N64 in a Richter Scale column next month.

Back to the PC world…

PC Graphics Board Trauma
Many, many years ago, when I left the employ of a still prominent New England graphics board company to start my own software company, I decided that my company would never get into thehardware business itself. Why? Mainly because of the overhead of inventory, the vagaries of the market, the lengthy time it takes to turn around a new design (a lot longer than software) and the intense competition.

In reflecting on that decision, I find I don’t regret it, even faced with the fact that over the years I had many opportunities to get into the graphics board market. However, the main reason I believe my decision was a good one is that I see the graphics board market in a death spiral. While I’m a believer in repetitive market cycles, i.e. boards do well vs. on-board graphics doing well, I have less faith now than ever that there will be a revival of the core consumer graphics board business.

Let’s look at why this may be.

First, there are more large stable graphics chip companies in the business now than ever before. Second, there are more systems and motherboard companies integrating graphics hardware on the motherboard than ever before. Third, while the PC market is still growing, the number of companies selling a majority of the PC systems is smaller than it has been. Finally, the new growth market will be the network computer, which has no room for a graphics board, but does have a socket for graphics chips.

I don’t think I’m alone in the opinion that the graphics board market is a potential dead end. Just take a look at the recent stock prices of some of the leading graphics board vendors.

The board companies that’ll be hurt the most are the ones that haven’t diversified into other markets.

For example, some board companies also develop their own graphics chips, while another prominent one sells modems and multimedia solutions, and yet another high end board company is getting into the vertical market software business. If your company’s main business is the development of graphics boards, diversify now, before it’s too late.

The future of graphics hardware is in the graphics chip business, and then only for the largest companies or those with unique, outstanding, and increasingly popular technology. It’s easier as a large chip company to convince a Compaq, IBM, or a Packard Bell to use ones products than if you’re a start-up. The only exception to this are chip companies whose products exude sex appeal, graphically speaking, and even then, the risk of using a small chip company as a supplier must be completely outweighed by the appeal. There are very few companies that currently qualify for this latter attention, and that’s out of a field of nearly three dozen.

However, the future is both bright and scary at the same time, and the chip companies (large of small) lacking vision are at greatest risk. Of course, vision is subjective. Were I to offer my vision of the future of graphics hardware, I’d have to say that in addition to all the features chip companies are offering in their silicon today, I’d require NTSC/PAL output as a key part of that vision. To refine the previous statement, I should add that any graphics chip company which wants to break into the next big market, namely network computing, needs what’s nominally called “TV Out” capability.

Network Computer Graphics
Netscape’s Navio announcement, combined with Zenith, Philips, Toshiba, Sony, Sega, and Nintendo all promoting TV-based Internet connectivity leaves no doubt in my mind that the current PC market pales when compared to the future of network computing. And every one of these countless network computers (NCs) will need a graphics chip, with TV Out capabilities. Sad to say, some of the NC companies are designing their own graphics chips, which is plain foolish in my opinion, since tried and tested graphics technology is currently available off the shelf.

So, if you’re a graphics chip maker, you had better be talking to at least a half dozen NC manufacturers about having them OEM your part. While on the subject of NCs, I predict that their wide deployment next year will cause another type of upheaval, namely in the realm of Web sites. In my all too frequent surfing of the Web, I find that a lot of Web sites don’t target what I consider to be the least common denominator in Web browsing technology:

  • A 640×480 resolution for the browser (not just for the browser window)
  • 256 colors
  • Easy to read pages that don’t require lots of scrolling to find links
  • Compact graphics (for quick download)
  • Very little multimedia (sound, animated graphics)
  • Java used sparingly
  • Frames used sparingly (because of minimal screen real estate)

Sites that don’t adhere to these basics will not be readily usable via most NCs. So, if your Web site breaks any of these rules, beware – you may be inadvertently shutting out millions of consumers.

Looking for Input
Okay, so you may have noticed I’ve gone for most of a column without mentioning my favorite company to harp on. Well, surprise, I don’t plan on mentioning them in this week’s column, only a query about some of their practices.

So, if you’re a graphics board or chip company that has recently had problems with getting your hardware/driver combination certified for Windows 95 and/or NT compliance via the Windows Hardware Qualification Lab (WHQL), especially for compliance issue which have not been previously documented (i.e. GDI by-pass, user interface, etc.) please drop me a note at about your experiences. All names will be held in confidence.

Added 10/13/96: Click here to see a rebuttal from STB Systems to my theory that graphics boards companies are in trouble.