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No, everyone else has not caught up in 2D, i think i read something in here that implied this, if you didn't mean to impy it then ok i'm wrong life goes on =P
Just saying Matrox makes really good 2D cards is also WAY off, the few workstation cards they have is not the only product they make, do some reading folks.
www.matrox.com
Understand the context of the 'everyone else has caught up' part;
"in the graphic card section everyone has caught up."
Their custom solutions are still good, but the GRAPHICS CARD portion of their solutions is now equalled and exceeded for DVI by the X1300 and GF7300 (FireMV and Quadro) products. The only area they still may have the argument as to being better would be the VGA segment, and even that is a minior difference at best.
As for their other products I allude to that in the rest of my comments, but that is truely the niche segment of their solutions, they need at least an X1600Pro level card IMO for HD acceleration.
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If matrox really wants to stay in the desktop segment at all, chances are these are all things they are thinking about, Simply put the OS is not a niche product, well windows isnt anyhow, if any company wants to stay onboard with the single most popular OS they will do what they gotta do.
Which is what all the talk is about with regards to their future, there are many people who deal with Matrox on a regular basis who are having this discussion right now. Matrox is leaving this too last minute for most because they have to test products long before we recommend them for 20+ computers. For us Matrox wasn't even on the list they got weeded out long before the testinf phase because even the GMA900/950 had more capabilities. And from the discussion in the Matrox forums alot of people who have many Matrox graphics card in their system have already started transitioning to ATi and nV products because the talk of a Matrox solution came too late for them to test Vista RC1 and their early Betas. While VISTA isn't the be all and end all, and neither is the 3D desktop, losing commercial clients who are finally moving from Win2K to Vista like half the PCs where I work (about 500 pcs under my direct line of sight [and it's not even my 'job', just the only one who can talk to the suppliers on a tech level]), Matrox being caught wrong footed on this is just shortsighted.
Check the Matrox forums and look at all the defectors, most don't want to leave, but the software programs just don't suppport the old Matrox cards, and of course the gamers are almost all long gone save for the triple monitor gamers who have no other options without buy 2 products the triple monitor 2 go and then a gaming card, even that is becoming attractive compared to terrible gaming driver support.
And I say this as a Matrox booster, the problem is that it looks like even they don't want to be in the graphics card business anymore, and without another product announcement soon, it's really hard to say otherwise.