Nvidia Acquires PortalPlayer For $357 Million

NVIDIA Corporation reported Monday that it is acquiring PortalPlayer Inc., in a move to beef up its development of personal media players (PMPs.) NVIDIA said it will pay about $357 million for San Jose, CA-based PortalPlayer.

As a developer of semiconductors, firmware, and software platforms for PMPs, PortalPlayer's product mix will fit neatly into NVIDIA's family of graphics processing units, NVIDIA said.

"With this acquisition, we are combining the two essential technologies of next-generation PMPs, PDAs, portable game players, and phones: PortalPlayer's innovative Application Processor technology and NVIDIA's industry-leading GPU technology," said Jen-Hsun Huang, president and CEO of NVIDIA, in a statement. "With the products created through this combination, we intend to drive the next digital revolution, where the mobile device becomes our most personal computer."

The news of the acquisition also solved a mystery that had been dogging San Jose last week when NVIDIA suddenly reported that it would back out of a deal to locate major office facilities in San Jose; with the acquisition of PortalPlayer, NVIDIA now has a major facility in San Jose.

Founded in 1999, PortalPlayer's system-on-chip (SoC) technology powers several popular digital music players. Headquartered in San Jose, PortalPlayer also has offices in Kirkland, WA, Taiwan and India.

NVIDIA has been the subject of rumors in recent weeks that it could be an acquisition candidate itself from Intel after Intel's arch-rival AMD acquired NVIDIA's arch-rival ATI. After AMD announced it would acquire ATI, Intel drastically trimmed its business with ATI.