Nvidia Bulks Up

By integrating the graphics capabilities with the application processor, Nvidia can offer phone makers a single chip with the same functionality but a more affordable price than two separate chips.

It also helps with power consumption, a key consideration in mobile electronic devices.

"You want it to be very cheap, very reliable and very low cost," says Roger Kay, president of market researcher Endpoint Technologies Associates.

Defense also may be motivating Nvidia.

If Nvidia doesn't embrace integration, its nascent cell-phone ambitions could run into the same problem the company is encountering in the PC industry.

"If you look at the graphics guys, their big problem economically has been that over time the discrete graphics business goes away," says Kay. "Whatever you do in discrete, a year or so later can be replicated."

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