The mission: An interview with Creative Labs
The object: The new product Line-up
Status: Object achieved

Quick links:

• The Interview
• The press-release and Boxshot nudies
• The Contest

Monday, April 30 I was contacted by Eoin Leyden - European Brand Manager - Graphics & Video Products from Creative Labs. He wrote a very enthusiastic e-mail regarding some secret new products and was wondering if we would like to do an exclusive interview with them about the new videocard product line-up.

'Of course!' was my immediate reaction. It has been really quiet in the close proximity of Creative Labs and their videocard division. The last product that we have seen & tested was their GeForce2 MX, then came the GeForce3 announcement from NVIDIA and from there on it was quiet. Creative labs is back, with GeForce2 MX 200, MX PCI, Pro and big surprise the 3D Blaster GeForce3 ! They have made some pretty interesting moves to get back in the 3D saddle. In this interview I will discuss the new product line-up, the changes and the future of the 3D Videocard division. Last but not least we have granted some of our users to submit questions on this topic. I have made a selection of these questions and included them into the interview.

On the last page you will find some exclusive product screenshots of the new line-up.

If you are done reading, you might want to check out our contest, you can win the first ever produced GeForce3 from Creative labs Europe!

Well, the NDA is now lifted, I can post the interview: Let's it begin the festivities.

[Hilbert Hagedoorn] - Late last year we suddenly heard a rumor from Creative Labs telling that your company will withdraw from the OEM segment of videocard market. Why was that decision made and why has it been so awfully quiet surrounding the videocard segment of your product line-up ?

[Eoin Leyden] - I think I will apologise in advance for the length of this answer but I think I should take the time to set the record straight. This rumour actually started as a result of comments made on one of our quarterly conference calls when we announce our financial results. What we said was that we were de-emphasising certain aspects of our graphics business and minimising our reliance on graphics as a revenue stream.

To explain why we said this requires a little understanding of the financial aspects of our business. In line with all companies we give revenue projections for coming fiscal periods and historically we have included graphics as a significant portion of that number. However, as you are well aware, the graphics market is extremely turbulent and it is very difficult to predict with a high degree of accuracy just how much revenue we can do in a particular time period. For this reason we decided to take a more prudent approach to forecasting our graphics related revenue.

For the second part as to why we have been quiet recently the answer is again a bit involved. In the run up to Christmas the slowdown in the market was obvious and we made a few educated guesses as to what that would mean in the graphics sector. Firstly we had big OEM’s not doing the sort of volume that was anticipated and that lead us to believe that there would be excess chips and memory in the market that had been built to meet a demand that no longer existed.

In cases like that where inventories run higher than normal most companies take pretty immediate action. In our business that means that pricing goes into freefall. The second issue that was on my mind was the 3Dfx situation … the company was holding large amounts of inventory and had no clear exit strategy from the retail market again that could only lead to price drops. And finally there was ATI and all those other companies who would be looking to pick up increased market share with 3Dfx’s departure .. sure enough we saw some really aggressive pricing from those guys, especially ATI.

In summary the market was oversupplied, everyone had large inventory, pricing was dropping and to be honest we simply felt that it was the perfect opportunity to pull back and evaluate how we could sustain a longterm profitable business model for retail graphics.