Graphics Pact Signed : S3, Creative partner to adapt to changing graphics world

Electronic News, March 8, 1999 by Peter Brown

Milpitas, Calif.-Add-in board supplier Creative Technology Limited and graphics accelerator IC maker S3 Inc. last week entered into a strategic partnership to provide graphics boards based on S3's Savage4 graphics engine.

The initial board, the 3D Blaster Savage4, is slated to be available in May priced at $129.99 and deliver full 128-bit 3-D graphics engine, 32-bit rendering and dual texture 3-D rendering pipeline. It also will feature AGP 4X and hardware-assisted DVD.

The agreement is not exclusive, but this gives both a good relationship for the future, said Steve Mosher, VP of the graphics business at Creative. Creative does have a strategic agreement with Nvidia Inc. and 3Dfx, but that will only be for a few more months until the Voodoo 3 comes on-line. With 3Dfx leaving Creative out in the cold with no more Voodoo products it needed a new supplier of 3-D chips and S3 is looking to regain some of its design wins lost when it missed a design cycle.

The move to merge graphics chip and board companies is becoming increasingly a wave of the future. Not only is it a proven successful business model-ATI Technologies Inc. and Matrox Graphics Inc are both the leaders in the market and both do in-house graphics boards-but it benefits both the add-in board supplier as well as the graphics house.

Instead of having to go to evolutionary next step in the graphics world of moving chips to a board house, companies are doing boards in house and selling directly to the retail channel or PC OEM. Skipping the middle man in other words. Creative and S3's partnership is a little different but the object of the partnership is the same-sell and bring graphics boards to the market easier.

This also continues S3's rise back into the graphics mainstream. After missing a design cycle it wasn't for all sure that the company was going to make it back on its feet. But it has and with its Savage4 3-D processor it hopes to recapture some of the design wins it lost to ATI and Matrox.

Recently, 3Dfx Interactive Inc. made a bid to buy STB Systems Inc. in an effort to secure selling its own boards and chips through the same channel. It also will no longer sell its chips to other add-in board suppliers. The company hopes the acquisition will move the company further in the OEM channels and open up the desktop mainstream market even more.

Matrox and ATI both continue to be vertically integrated and with graphics board houses having more trouble every month selling to OEMs- who now get more product directly from the graphics IC vendor-the idea of exclusively teaming-up with a graphics chip maker is no longer a foreign thought. n