But surely Intel's performance lead is basically a matter of process, not architecture. Presumably nVidia is going to strive very hard to narrow the process gap - and if it doesn't succeed at that, it's not as if an x86 arch would have saved it.

Nvidia may well narrow the low end x86 and high end ARM performance gap but at that point for a desktop they would have same/similar performance of x86 at may be a lower cost but at the huge disadvantage of lack of compatibility - apps and peripherals likewise.

EDIT: http://arstechnica.com/gadgets/news/2011/01/nvidias-project-... says this isn't about the desktop as much as it is about servers and workstations. Makes much more sense. John Stokes rightly points out - "this is a very tall order, and a lot of things could go wrong here. Right now, the GPU execution part is the only one where confidence is warranted based on a track record. With the system integration stuff and CPU part, NVIDIA is in uncharted territory. "

Sure. On the one hand the mid-to-high end desktop isn't the be-all and end-all of high-end chipmaker revenues anymore. And on the other hand a mid-to-high end Windows ARM desktop might be usable with some combination of native Windows and Office, an increasing supply of new ARM-native Windows binaries from ISVs (the Internet should help by making distribution much easier), Web apps running in ARM-native Web browsers, and butt-slow emulation for old but indispensable x86 binaries. It seems to me that the biggest issue could turn out to be PC games. Presumably nVidia either has to get the big games studios to issue ARM ports of their next and recent games, or it has to go on being successful at selling standalone GPUs for gamers' x86 PCs, or it has to give up on its gaming constituency for a time at least. I presume that since most PC games are now written to port to PowerPC and/or Cell, doing an ARM port isn't the adventure it might once have been?

Many games already run on iOS and Android which are ARM based and so at least those games could be ported.

Why Nvidia might want to compete with either of the PC, Portable Gaming Systems (PSP, iTouch, PSPhone), Xbox360 and PS3 without either a solid advantage or agreement with big game studios is beyond me.

nVidia may not have much choice but to try, if it's being locked out of the x86 CPU market at the same time that the market for third-party discrete GPUs on x86 PCs is being squeezed hard. And supporting ARM Windows may not that big a burden for PC game publishers if Windows' ARM support is first-class and producing an ARM build is largely just a recompile for the studios.

It's about the cost: 2GB RAM, 2-core 2GHz ARM CPU, GPU, 160GB hard disk, for just 100 US$. Add another 100 US$ for a case, keyboard, mouse and a cheap monitor... the whole desktop computer for just 200 US$ (!)

Obviously. But people need performance on the desktop. With cheap AMD / Intel QC CPUs do you think ARM will offer better performance at significantly lower cost than AMD/Intel? I doubt it. And just cost is not going to play well in the desktop market.

EDIT : At that configuration, without a monitor, when desktop sales are all time low compared to laptops in the PC market - why wouldn't one just buy a AMD Fusion Netbook?

Desktop performance, most of the time, isn't CPU-bound. HDD speed is the usual suspect.

These NVidia chips will most likely ship with custom circuitry to accelerate the few CPU hungry operations performed at the desktop (video codecs and 3D gfx). Keep in mind that at that point, at least 8 cores per chip will probably be the norm. Single core performance will not be that important.

Edit: of course, add CUDA to the mix regarding computationally heavy tasks without dedicated acceleration.

We'll see. Not everyone lives in a rich country.