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Nvidia ignores the console wars and doubles down on GPUs

PC gaming is still a huge market, and Nvidia isn't afraid to commit to it.

Nvidia ignores the console wars and doubles down on GPUs

The company's new cards will be released later this month.

Photo: Nvidia

What next-generation gaming consoles? The real action in the $160 billion video game business is on PCs.

That was Nvidia's dismissive subtext on Tuesday as the company unveiled its first major new line of consumer graphics hardware in two years. While Sony and Microsoft are yet to reveal pricing and timing details for their new game machines expected this fall, Nvidia is getting on the all-important holiday wish lists early, with specific product announcements that will make many gamers' eyes water.

In addition to announcing a new line of powerful PC graphics cards for the fall — ranging from $500 to $1,500 — Nvidia also flaunted its tight relationships with many of the largest and most popular game developers. Nvidia and Epic Games — which is locked in a high-stakes antitrust lawsuit with Apple — announced that Fortnite, Epic's flagship franchise, would soon add support for Nvidia's ray-tracing technology, which generates more realistic and immersive lighting effects. Nvidia also revealed footage of two other highly anticipated games — Call of Duty: Black Ops Cold War (from Activision Blizzard) and Cyberpunk 2077 (from CD Projekt) — that will use the same technology.

PCs are the world's most popular gaming platform with about 1.5 billion players — roughly half of the 3 billion gamers worldwide. By contrast, only about 8% of gamers globally appear to be dedicated console players. That's one reason why Nvidia, the leader in PC graphics, does not appear especially chagrined that both Microsoft and Sony opted for graphics systems from AMD for their new consoles. Dedicated PC gamers will pay more for a single graphics card than console gamers pay for their entire systems.

Wearing his trademark leather jacket and standing in his home's kitchen, Jensen Huang, Nvidia's chief executive, announced that the company's new 3070 card would be released next month starting at $499, the 3080 card would be released Sept. 17 starting at $699 and the 3090 (continuing a new trend of revealing hardware from his oven, saying "Come here, papa") would arrive Sept. 24 starting at $1,499. The company said that the 3080 — which Huang called the company's new "flagship," presumably because of what it sees as a sweet-spot positioning of price and performance — delivers up to twice the horsepower of current 2080 cards, which can cost up to $1,200.

In addition to the new cards, Nvidia also revealed new software to improve the performance of older cards; enable advanced machinima storytelling; and improve video and audio streaming quality.

 Seth Schiesel

Seth Schiesel ( @SethSchiesel) is a contributing editor for Protocol focused on the business of video games and adjacent industries. He is a former editorial writer for The Boston Globe, entrepreneur and business reporter, technology writer and video game critic for The New York Times.

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health tech
Protocol | China

Everything you need to know about the Yuanxin Technology IPO

Image: Yuanxin

Yuanxin Technology doesn't hide its ambition. In the first line of its prospectus, the company says its mission is to be the "first choice for patients' healthcare and medication needs in China." But the road to winning the crowded China health tech race is a long one for this Tencent- and Sequoia-backed startup, even with a recent valuation of $4 billion, according to Chinese publication Lieyunwang. Here's everything you need to know about Yuanxin Technology's forthcoming IPO on the Hong Kong Stock Exchange.

What does Yuanxin do?

There are many ways startups can crack open the health care market in China, and Yuanxin has focused on one: prescription drugs. According to its prospectus, sales of prescription drugs outside hospitals account for only 23% of the total healthcare market in China, whereas that number is 70.2% in the United States.

Yuanxin started with physical stores. Since 2015, it has opened 217 pharmacies immediately outside Chinese hospitals. "A pharmacy has to be on the main road where a patient exits the hospital. It needs to be highly accessible," Yuanxin founder He Tao told Chinese media in August. Then, patients are encouraged to refill their prescriptions on Yuanxin's online platforms and to follow up with telehealth services instead of returning to a hospital.

From there, Yuanxin has built a large product portfolio that offers online doctor visits, pharmacies and private insurance plans. It also works with enterprise clients, designing office automation and prescription management systems for hospitals and selling digital ads for big pharma.

Yuanxin's Financials

Yuanxin's annual revenues have been steadily growing from $127 million in 2018 to $365 million in 2019 and $561 million in 2020. In each of those three years, over 97% of revenue came from "out-of-hospital comprehensive patient services," which include the company's physical pharmacies and telehealth services. More specifically, approximately 83% of its retail sales derived from prescription drugs.

But the company hasn't made a profit. Yuanxin's annual losses grew from $17 million in 2018 to $26 million in 2019 and $48 million in 2020. The losses are moderate considering the ever-growing revenues, but cast doubt on whether the company can become profitable any time soon. Apart from the cost of drug supplies, the biggest spend is marketing and sales.

What's next for Yuanxin

There are still abundant opportunities in the prescription drug market. In 2020, China's National Medical Products Administration started to explore lifting the ban on selling prescription drugs online. Although it's unclear when the change will take place, it looks like more purely-online platforms will be able to write prescriptions in the future. With its established market presence, Yuanxin is likely one of the players that can benefit greatly from such a policy change.

The enterprise and health insurance businesses of Yuanxin are still fairly small (accounting for less than 3% of annual revenue), but this is where the company sees an opportunity for future growth. Yuanxin is particularly hoping to power its growth with data and artificial intelligence. It boasts a database of 14 million prescriptions accumulated over years, and the company says the data can be used in many ways: designing private insurance plans, training doctors and offering chronic disease management services. The company says it currently employs 509 people on its R&D team, including 437 software engineers and 22 data engineers and scientists.

What Could Go Wrong?

The COVID-19 pandemic has helped sell the story of digital health care, but Yuanxin isn't the only company benefiting from this opportunity. 2020 has seen a slew of Chinese health tech companies rise. They either completed their IPO process before Yuanxin (like JD, Alibaba and Ping An's healthcare subsidiaries) or are close to it (WeDoctor and DXY). In this crowded sector, Yuanxin faces competition from both companies with Big Tech parent companies behind them and startups that have their own specialized advantages.

Like each of its competitors, Yuanxin needs to be careful with how it processes patient data — some of the most sensitive personal data online. Recent Chinese legislation around personal data has made it clear that it will be increasingly difficult to monetize user data. In the prospectus, Yuanxin elaborately explained how it anonymizes data and prevents data from being leaked or hacked, but it also admitted that it cannot foresee what future policies will be introduced.

Who Gets Rich

  • Yuanxin's founder and CEO He Tao and SVP He Weizhuang own 29.82% of the company's shares through a jointly controlled company. (It's unclear whether He Tao and He Weizhuang are related.)
  • Tencent owns 19.55% of the shares.
  • Sequoia owns 16.21% of the shares.
  • Other major investors include Qiming, Starquest Capital and Kunling, which respectively own 7.12%, 6.51% and 5.32% of the shares.

What People Are Saying

  • "The demands of patients, hospitals, insurance companies, pharmacies and pharmaceutical companies are all different. How to meet each individual demand and find a core profit model is the key to Yuanxin Technology's future growth." — Xu Yuchen, insurance industry analyst and member of China Association of Actuaries, in Chinese publication Lanjinger.
  • "The window of opportunity caused by the pandemic, as well as the high valuations of those companies that have gone public, brings hope to other medical services companies…[But] the window of opportunity is closing and the potential of Internet healthcare is yet to be explored with new ideas. Therefore, traditional, asset-heavy healthcare companies need to take this opportunity and go public as soon as possible." —Wang Hang, founder and CEO of online healthcare platform Haodf, in state media China.com.

Zeyi Yang
Zeyi Yang is a reporter with Protocol | China. Previously, he worked as a reporting fellow for the digital magazine Rest of World, covering the intersection of technology and culture in China and neighboring countries. He has also contributed to the South China Morning Post, Nikkei Asia, Columbia Journalism Review, among other publications. In his spare time, Zeyi co-founded a Mandarin podcast that tells LGBTQ stories in China. He has been playing Pokemon for 14 years and has a weird favorite pick.
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From Home to Hybrid: Asana’s COO Shares Back-to-Office Advice on Productivity

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"While consumers and early adopter businesses had widely embraced collaborative applications prior to the pandemic, the market saw five years' worth of new users in the first six months of 2020," said Wayne Kurtzman, research director of social and collaboration at IDC. "This has cemented collaboration, at least to some extent, for every business, large and small."

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Protocol | Workplace

How to make remote work work

Hofy made an early bet that COVID-19 would have a long-term impact on workplaces. The company recently raised $15.2 million for its remote workforce equipment management solution.

Hofy recently raised $15.2 million for its remote workforce equipment management service.

Photo: Jannis Brandt/Unsplash

It's your new employee's first day of remote work, but their laptop hasn't shown up yet. Not a good look.

This very 2021 persistent problem is part of why Hofy, a remote workplace management tool, recently raised $15.2 million to help companies deploy laptops, chairs, desks and other physical equipment to their remote employees. The idea for Hofy, which is launching out of stealth today, emerged in the early days of the COVID-19 pandemic — before lockdowns went into effect in the U.S. and the U.K. Hofy's co-founders, Sami Bouremoum and Michael Ginzo, had a feeling that COVID-19 would have a long-term effect on society.

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Megan Rose Dickey is a senior reporter at Protocol covering labor and diversity in tech. Prior to joining Protocol, she was a senior reporter at TechCrunch and a reporter at Business Insider.

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Protocol | Policy

Tech giants want to hire Afghan refugees. The system’s in the way.

Amazon, Facebook and Uber have all committed to hiring and training Afghan evacuees. But executing on that promise is another story.

"They're authorized to work, but their authorization has an expiration date."

Photo: Andrew Caballero-Reynolds/AFP via Getty Images

Late last month, Amazon, Facebook and Uber joined dozens of other companies in publicly committing to hire and train some of the 95,000 Afghan refugees who are expected to be resettled in the United States over the next year, about half of whom are already here.

But nearly two months since U.S. evacuations from Kabul ended and one month since the companies' public commitments, efforts to follow through with those promised jobs remain stalled. That, experts say, is partly to do with the fact that the vast majority of Afghan arrivals are still being held at military bases, partly to do with their legal classification and partly to do with a refugee resettlement system that was systematically dismantled by the Trump administration.

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Issie Lapowsky

Issie Lapowsky ( @issielapowsky) is Protocol's chief correspondent, covering the intersection of technology, politics, and national affairs. She also oversees Protocol's fellowship program. Previously, she was a senior writer at Wired, where she covered the 2016 election and the Facebook beat in its aftermath. Prior to that, Issie worked as a staff writer for Inc. magazine, writing about small business and entrepreneurship. She has also worked as an on-air contributor for CBS News and taught a graduate-level course at New York University's Center for Publishing on how tech giants have affected publishing.

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Protocol | Fintech

How European fintech startup N26 is preparing for U.S. regulations

"There's a lot more scrutiny being placed on fintech. We are definitely mindful of it."

In an interview with Protocol, Stephanie Balint, N26's U.S. general manager, discussed the company's approach to regulations in the U.S.

Photo: N26

N26's monster $900 million funding round announced Monday underlined the German startup's momentum in the digital banking market.

Stephanie Balint, N26's U.S. general manager, said the funding will be used for expansion and also to improve "our core offering to make this the most reliable bank that our customers can trust," she told Protocol.

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Benjamin Pimentel

Benjamin Pimentel ( @benpimentel) covers fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at bpimentel@protocol.com or via Signal at (510)731-8429.

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