Computer Graphics World

September / October 2017

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s e p t e m b e r . o c t o b e r 2 0 1 7 c g w 5 S P O T L I G H T ADD-IN BOARD MARKET RISES The add-in graphics board market was outstanding in Q2 '17, increasing 30.9% sequentially and 34.9% year-to-year, according to Jon Peddie, president of industry research consulting firm Jon Peddie Research (JPR). The market shares for the desktop discrete GPU suppliers shied in the quarter, too. The GPU and PC market had been showing a return to normal seasonality. That pattern is typically flat to down in Q1, a significant drop in Q2 as OEMs and the channel deplete inventory before the summer months, a restocking with the latest products in Q3 in anticipation of the holiday season, and mild increase to flat change in Q4. All of that has been subject to an overall decline in the PC market since the great recession of '07 and the influx of tablets and smartphones. However, this year, Q2 AIB shipments were completely out of sync and remarkably high. In fact, this is the first time in over nine years that Q2 has seen an increase in shipments, and never one this dramatic. The big difference is the impact that cryptocurrency mining (es- pecially Ethereum) is having on the market. People are sending Bitcoins to each other over the Bitcoin net- work all the time, but unless someone keeps a record of all these transactions, no one would be able to keep track of who had paid what. The Bitcoin network deals with this by collecting all of the transactions made during a set period into a list, called a block. It's the miners' job to confirm those transactions and write them into a general ledger. They are paid for this work in like currency. Ethereum is designed to resist the development of Ethere- um-mining ASICs. Ethereum uses a different hashing algorithm to Bitcoin, which makes it incompatible with the special hashing hardware (ASICs) developed for Bitcoin mining. Ethereum's algorithm is known as Ethash. It's a memory-hard algorithm, meaning it's designed to resist the development of Ethereum-mining ASICs. Instead, Ethash is deliberately best suited to GPU mining. The PC add-in board (AIB) market now has just two chip (GPU) suppliers that also build and sell AIBs. The primary suppliers of GPUs are AMD and Nvidia. There are 48 AIB suppliers, the AIB OEM cus- tomers of the GPU suppliers, which they call "partners." In addition to privately branded AIBs that are offered world- wide, about a dozen PC suppliers offer AIBs as part of a system or as an option, and some that offer AIBs as separate aermarket products. JPR has been tracking AIB shipments quarterly since 1987 – the volume of those boards peaked in 1999, reaching 114 million units; in 2015, 44 million shipped. Since the introduction of the PC, which was in 1981, believe it or not, JPR estimates that 2.1 billion AIBs will have been shipped by the end of this year. And the inflation-adjusted value is $1.02 trillion dollars. The news for the quarter was encouraging and seasonally under- standable: Quarter-to-quarter, the AIB market increased 30.9% (compared to the desktop PC market, which decreased 18.2%). AIB shipments during the quarter increased from the last quarter by 30.9%, which is above the 10-year average of -9.8%. On a year- to-year basis, JPR found that total AIB shipments during the quarter rose 34.9%, and that is greater than desktop PCs, which fell 30.0%. E T H E R E U M M I N I N G T H E G A M E C H A N G E R In spite of the overall PC churn, somewhat due to tablets and em- bedded graphics, the Ethereum mining and PC gaming momentum continues to build and is the bright spot in the AIB market. The gaming PC (system) market is as vibrant as the stand- alone AIB market. All OEMs are investing in the gaming space because demand for gaming PCs is robust. Intel also validated this on its earnings call, along with the recent announcement of a new enthusiast CPU. However, it won't show in the overall market numbers because, like gaming GPUs, the gaming PCs are dwarfed by the general-purpose machines. JPR's research finds that global GPU market demand in Q2 '16 decreased from last quarter and decreased from last year, to 83.32 million units. In recent years, as the gaming ecosystem be- gins to shape up, soware and hardware developers, information service providers, and even governments have been attempting to unearth market opportunities coming from this new arena. However, global PC shipment volume is forecast to fall further.

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