"Like they did in desktops, [ATI and Nvidia] start at the top with an incredible part and let it slide down into the mainstream as they get their costs down," said Jon Peddie of Jon Peddie Research, Tiburon, Calif. "They get a nice long ride as every dollar they make at the lower end is pure profit after they've covered costs with their high-end [prices]."

ATI's Mobility Fire GL 7800 is a 64Mbyte, 128-bit DDR memory processor with a 270MHz clock speed and 32-bit color resolution.

The company claims its Hyper Z technology boosts memory bandwidth by more than 20%. The processor's power consumption feature, called Powerplay, is designed to offer high performance when needed and to conserve power when the demand on the processor is low. In notebooks weighing between eight and nine pounds with two to three spindles and a 14- to 15in. screen, typical power consumption is between 20 and 30W, according to ATI, Markham, Ontario.

A new architecture

Nvidia, Santa Clara, Calif., today will unveil the NV17M, which the company says sports a completely different architecture than its GeForce2 Go, Nvidia's first processor for the notebook market, introduced last year. The device offers a clock speed of 250MHz, memory bandwidth of 8Gbits/s, and some of Nvidia's enhanced desktop graphics features such as anti-aliasing effects.

Like ATI's Mobility Fire GL 7800, Nvidia's NV17M possesses a power reduction capability that automatically shuts down the processor when it's not in use.

A Dell Inspiron weighing eight pounds with three spindles and a 15in. screen consumes an average of 30W when the NV17M is set at its maximum rate of 93 frames/s, and consumes an average of 18W when the processor is set at 24 frames/s, based on an Nvidia test observed by EBN.

"We're offering a lot of high-end desktop features in the mobile space, with the longest battery path in the industry and with maximum performance and frame rates," said Bill Henry, an Nvidia director of mobile product management. "We think the performance beats anything else in the industry, hands down."

While some industry sources speculated that Nvidia revamped its initial mobile architecture because it could not effectively compete against ATI the first time around, Dean McCarron, an analyst at Mercury Research Inc., Scottsdale, Ariz., said Nvidia's initial foray into notebooks has been successful.

"You could ask, if ATI's previous device was successful, why did they come out with the 7800," McCarron said. "But mobile is a very slow-moving market, so Nvidia has in fact garnered many sales, consistent with a new entry in the market. So, I wouldn't say they haven't been successful."

Prices to come down

Neither company would disclose pricing, but said their new processors are designed for the "mobile workstation market" in which high-end graphics applications such as CAD drawings are normally found.

Darren McPhee, a product marketing manager at ATI, said such high-end applications will represent up to 20% of unit demand in the notebook sector.

Meanwhile, ATI and Nvidia both claimed that their new processors will come down to mainstream prices within a year, following the launch of their next-generation notebook graphics ICs.

"The trend you're seeing in desktops with sub-$1,000 price points for PCs with [high-end graphics cards] is now beginning to happen on the mobile side," ATI's McPhee said.

Taking on Intel

And as today's high-end graphics ICs begin to find themselves in lower-priced notebooks, they will also find themselves in integrated packages for lower-tier applications, although neither ATI nor Nvidia has disclosed specific integrated designs for notebooks.

Intel Corp., which only offers integrated graphics chipsets and leads in volume share in the desktop market, has a strong foothold in the low-end, integrated graphics-IC market for notebooks. But according to Philip Eisler, general manager of ATI's mobile graphics division, it's only a matter of time before today's high-end graphics ICs dominate mainstream notebook market share and will eventually overwhelm Intel's remaining stronghold in both notebooks and desktops.

"Intel more or less exited the performance sector a couple of years back to make a play toward the bottom with a chipset focus for the sort of people who want to just light up the screen," Eisler said. "But we're taking the high-end features and bringing the price curve down at the same time."

ATI also claims its leading graphics-IC market share for notebooks will grow. According to McPhee, ATI has already scored a majority of design wins, to be announced through the first quarter of next year, in notebooks that will feature Intel's as yet unannounced Pentium 4-based notebook architecture. "We've been able to successfully hit Pentium III notebooks, and we will be able to hit Pentium 4 as well," he said.