Bumpgate: Difference between revisions

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On July 2nd, 2008- a few days before Demerjian's article was published- Nvidia filed a report with the Securities and Exchange Commission (SEC).<ref name=":10" /> The report explained that the corporation would pay a $150-200 million one-time charge to cover customer warranties, repair, returns, replacements, and other notable expenses caused by poor packaging material in some of their multi-chip packages (MCPs) and GPUs exclusively used in laptops. This report also confirmed that all of their newly manufactured products from that point forward would have a more suitable material set.

As Joel Hruska from Ars Technica explained, if Nvidia was trying to cover up the defect- as Demerjian claimed- with this report to the SEC, they not only attempted to avoid responsibility and accused their suppliers of causing the problem, they also committed financial fraud by intentionally lowballing their expected financial losses- a major accusation that could have had severe consequences for Nvidia.<ref name=":11">{{Cite web |last=Hruska |first=Joel |date=16 Jul 2008 |title=NVIDIA denies rumors of faulty chips, mass GPU failures |url=https://arstechnica.com/gadgets/2008/07/nvidia-denies-rumors-of-mass-gpu-failures/ |url-status=live |access-date=8 Jun 2025 |website=Ars Technica}}</ref> However, it is difficult to verify if Nvidia was lying or simply not fully aware of the scale of Bumpgate. Nvidia's public acknowledgement of the defect in the SEC report is consistent with when Sony switched the PlayStation 3 to the non-defective 65nm Nvidia RSX,<ref name=":6" /> and it also seems to be consistent with when Dell<ref name=":8" /> and HP<ref name=":7" /> discovered the problem. The only company it does not appear consistent with is Apple, who discovered the defect in their Macbook Pro systems after their own investigation in September 2008.<ref name=":9" /> Even so, it is possible that Nvidia did not know that the GeForce 8600M GT GPUs in the 2007-2008 Macbook Pro were impacted yet when Apple asked them about it.

As Joel Hruska from Ars Technica explained, if Nvidia ''was'' trying to cover up the defect- as Demerjian claimed- with this report to the SEC, they not only attempted to avoid responsibility and accused their suppliers of causing the problem, they also committed financial fraud by intentionally lowballing their expected financial losses. This is a major accusation that could have had severe consequences for Nvidia.<ref name=":11">{{Cite web |last=Hruska |first=Joel |date=16 Jul 2008 |title=NVIDIA denies rumors of faulty chips, mass GPU failures |url=https://arstechnica.com/gadgets/2008/07/nvidia-denies-rumors-of-mass-gpu-failures/ |url-status=live |access-date=8 Jun 2025 |website=Ars Technica}}</ref> However, it is difficult to verify if Nvidia was lying or simply not fully aware of the scale of Bumpgate. Nvidia's public acknowledgement of the defect in the SEC report is consistent with when Sony switched the PlayStation 3 to the non-defective 65nm Nvidia RSX,<ref name=":6" /> and it also seems to be consistent with when Dell<ref name=":8" /> and HP<ref name=":7" /> discovered the problem. The only company it does not appear consistent with is Apple, who discovered the defect in their Macbook Pro systems after their own investigation in September 2008.<ref name=":9" /> Even so, it is possible that Nvidia did not know that the GeForce 8600M GT GPUs in the 2007-2008 Macbook Pro were impacted yet when Apple asked them about it.

Regardless of if Nvidia was truthful in their report or not, they denied the claims that individuals like Demerjian were making- that their GPUs were defective and failing en masse.<ref name=":11" /> However, by 2010, consumers' trust in Nvidia had eroded to the point that a class action lawsuit was filed because of the defect.

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==Nvidia Lawsuit (2010)==

=== Claims ===

===Claims===

Main claims of the suit.

=== Rebuttal ===

===Rebuttal===

The response of Nvidia or counterclaims.

=== Outcome ===

===Outcome===

The outcome of the suit. (Settlement)

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===Xbox 360/Microsoft Consumer response===

At first, consumers were angry at Microsoft. During the months that Microsoft would not acknowledge the widespread "Red Ring of Death", consumers felt as if they'd been scammed and made a bad investment. However, when Microsoft extended the warranty on Xbox 360s experiencing an E74 error to three years after purchase, consumer sentiment improved. After Microsoft's explanation and confirmation of the exact issue that caused the "Red Ring of Death" in ''Power On: The Story of Xbox''<ref name=":3" />, many consumers who remembered dealing with this issue felt further validated. The release of this information also helped enthusiasts learn more about how to fix the issue not only in early Xbox 360s, but even in Sony's early PlayStation 3 systems.

At first, consumers were angry at Microsoft. During the months that Microsoft would not acknowledge the widespread "Red Ring of Death", consumers felt as if they'd been scammed and made a bad investment. However, when Microsoft extended the warranty on Xbox 360s experiencing an E74 error to three years after purchase, consumer sentiment improved. After Microsoft's explanation and confirmation of the exact issue that caused the "Red Ring of Death" in ''Power On: The Story of Xbox''<ref name=":3" />, many consumers who remembered dealing with this issue felt further validated. The release of this information also helped enthusiasts learn more about how to fix the issue not only in early Xbox 360s, but even in Sony's early PlayStation 3 systems- as this helped elucidate the true cause of the early PS3s' problems.

===PlayStation 3/Sony Consumer Response===

===Nvidia Consumer Response===

Based on the fact that this problem affected the Xbox 360's ATI graphics processor, Nvidia was likely not fully responsible for the defect. However, their appearance of a poor response to the defect ultimately left consumers very angry with the company- enough to prompt a class-action lawsuit.

Based on the fact that this problem affected the Xbox 360's ATI graphics processor, Nvidia was likely not fully responsible for the defect. In fact, they alleged in the SEC report that it was their packaging company that caused the problem. However, their appearance of a poor response to the defect ultimately left consumers very angry with the company- enough to prompt a class-action lawsuit.

===Misdiagnosis/Poor Repair of Faults===

@@ Line 59: / Line 59: @@
 On July 2nd, 2008- a few days before Demerjian's article was published- Nvidia filed a report with the Securities and Exchange Commission (SEC).<ref name=":10" /> The report explained that the corporation would pay a $150-200 million one-time charge to cover customer warranties, repair, returns, replacements, and other notable expenses caused by poor packaging material in some of their multi-chip packages (MCPs) and GPUs exclusively used in laptops. This report also confirmed that all of their newly manufactured products from that point forward would have a more suitable material set.
-As Joel Hruska from Ars Technica explained, if Nvidia was trying to cover up the defect- as Demerjian claimed- with this report to the SEC, they not only attempted to avoid responsibility and accused their suppliers of causing the problem, they also committed financial fraud by intentionally lowballing their expected financial losses- a major accusation that could have had severe consequences for Nvidia.<ref name=":11">{{Cite web |last=Hruska |first=Joel |date=16 Jul 2008 |title=NVIDIA denies rumors of faulty chips, mass GPU failures |url=https://arstechnica.com/gadgets/2008/07/nvidia-denies-rumors-of-mass-gpu-failures/ |url-status=live |access-date=8 Jun 2025 |website=Ars Technica}}</ref> However, it is difficult to verify if Nvidia was lying or simply not fully aware of the scale of Bumpgate. Nvidia's public acknowledgement of the defect in the SEC report is consistent with when Sony switched the PlayStation 3 to the non-defective 65nm Nvidia RSX,<ref name=":6" /> and it also seems to be consistent with when Dell<ref name=":8" /> and HP<ref name=":7" /> discovered the problem. The only company it does not appear consistent with is Apple, who discovered the defect in their Macbook Pro systems after their own investigation in September 2008.<ref name=":9" /> Even so, it is possible that Nvidia did not know that the GeForce 8600M GT GPUs in the 2007-2008 Macbook Pro were impacted yet when Apple asked them about it.
+As Joel Hruska from Ars Technica explained, if Nvidia ''was'' trying to cover up the defect- as Demerjian claimed- with this report to the SEC, they not only attempted to avoid responsibility and accused their suppliers of causing the problem, they also committed financial fraud by intentionally lowballing their expected financial losses. This is a major accusation that could have had severe consequences for Nvidia.<ref name=":11">{{Cite web |last=Hruska |first=Joel |date=16 Jul 2008 |title=NVIDIA denies rumors of faulty chips, mass GPU failures |url=https://arstechnica.com/gadgets/2008/07/nvidia-denies-rumors-of-mass-gpu-failures/ |url-status=live |access-date=8 Jun 2025 |website=Ars Technica}}</ref> However, it is difficult to verify if Nvidia was lying or simply not fully aware of the scale of Bumpgate. Nvidia's public acknowledgement of the defect in the SEC report is consistent with when Sony switched the PlayStation 3 to the non-defective 65nm Nvidia RSX,<ref name=":6" /> and it also seems to be consistent with when Dell<ref name=":8" /> and HP<ref name=":7" /> discovered the problem. The only company it does not appear consistent with is Apple, who discovered the defect in their Macbook Pro systems after their own investigation in September 2008.<ref name=":9" /> Even so, it is possible that Nvidia did not know that the GeForce 8600M GT GPUs in the 2007-2008 Macbook Pro were impacted yet when Apple asked them about it.
 Regardless of if Nvidia was truthful in their report or not, they denied the claims that individuals like Demerjian were making- that their GPUs were defective and failing en masse.<ref name=":11" /> However, by 2010, consumers' trust in Nvidia had eroded to the point that a class action lawsuit was filed because of the defect.
@@ Line 65: / Line 65: @@
 ==Nvidia Lawsuit (2010)==
-=== Claims ===
+===Claims===
 Main claims of the suit.
-=== Rebuttal ===
+===Rebuttal===
 The response of Nvidia or counterclaims.
-=== Outcome ===
+===Outcome===
 The outcome of the suit. (Settlement)
@@ Line 78: / Line 78: @@
 ===Xbox 360/Microsoft Consumer response===
-At first, consumers were angry at Microsoft. During the months that Microsoft would not acknowledge the widespread "Red Ring of Death", consumers felt as if they'd been scammed and made a bad investment. However, when Microsoft extended the warranty on Xbox 360s experiencing an E74 error to three years after purchase, consumer sentiment improved. After Microsoft's explanation and confirmation of the exact issue that caused the "Red Ring of Death" in ''Power On: The Story of Xbox''<ref name=":3" />, many consumers who remembered dealing with this issue felt further validated. The release of this information also helped enthusiasts learn more about how to fix the issue not only in early Xbox 360s, but even in Sony's early PlayStation 3 systems.
+At first, consumers were angry at Microsoft. During the months that Microsoft would not acknowledge the widespread "Red Ring of Death", consumers felt as if they'd been scammed and made a bad investment. However, when Microsoft extended the warranty on Xbox 360s experiencing an E74 error to three years after purchase, consumer sentiment improved. After Microsoft's explanation and confirmation of the exact issue that caused the "Red Ring of Death" in ''Power On: The Story of Xbox''<ref name=":3" />, many consumers who remembered dealing with this issue felt further validated. The release of this information also helped enthusiasts learn more about how to fix the issue not only in early Xbox 360s, but even in Sony's early PlayStation 3 systems- as this helped elucidate the true cause of the early PS3s' problems.
 ===PlayStation 3/Sony Consumer Response===
 ===Nvidia Consumer Response===
-Based on the fact that this problem affected the Xbox 360's ATI graphics processor, Nvidia was likely not fully responsible for the defect. However, their appearance of a poor response to the defect ultimately left consumers very angry with the company- enough to prompt a class-action lawsuit.
+Based on the fact that this problem affected the Xbox 360's ATI graphics processor, Nvidia was likely not fully responsible for the defect. In fact, they alleged in the SEC report that it was their packaging company that caused the problem. However, their appearance of a poor response to the defect ultimately left consumers very angry with the company- enough to prompt a class-action lawsuit.
 ===Misdiagnosis/Poor Repair of Faults===