One day after Valve's presentation, NVIDIA send us an official comment on the situation:

Over the last 24 hours, there has been quite a bit of controversy over comments made by Gabe Newell of Valve at ATIs Shader Day.

During the entire development of Half Life 2, NVIDIA has had close technical contact with Valve regarding the game. However, Valve has not made us aware of the issues Gabe discussed.

We're confused as to why Valve chose to use Release. 45 (Rel. 45) - because up to two weeks prior to the Shader Day we had been working closely with Valve to ensure that Release 50 (Rel. 50) provides the best experience possible on NVIDIA hardware.

Regarding the Half Life2 performance numbers that were published on the web, we believe these performance numbers are invalid because they do not use our Rel. 50 drivers. Engineering efforts on our Rel. 45 drivers stopped months ago in anticipation of Rel. 50. NVIDIA's optimizations for Half Life 2 and other new games are included in our Rel.50 drivers - which reviewers currently have a beta version of today. Rel. 50 is the best driver we've ever built - it includes significant optimizations for the highly-programmable GeForce FX architecture and includes feature and performance benefits for over 100 million NVIDIA GPU customers.

Pending detailed information from Valve, we are only aware one bug with Rel. 50 and the version of Half Life 2 that we currently have - this is the fog issue that Gabe referred to in his presentation. It is not a cheat or an over optimization. Our current drop of Half Life 2 is more than 2 weeks old.

NVIDIA's Rel. 50 driver will be public before the game is available. Since we know that obtaining the best pixel shader performance from the GeForce FX GPUs currently requires some specialized work, our developer technology team works very closely with game developers. Part of this is understanding that in many cases promoting PS 1.4 (DirectX 8) to PS 2.0 (DirectX 9) provides no image quality benefit. Sometimes this involves converting 32-bit floating point precision shader operations into 16-bit floating point precision shaders in order to obtain the performance benefit of this mode with no

image quality degradation. Our goal is to provide our consumers the best experience possible, and that means games must both look and run great.

The optimal code path for ATI and NVIDIA GPUs is different - so trying to test them with the same code path will always disadvantage one or the other. The default settings for each game have been chosen by both the developers and NVIDIA in order to produce the best results for our consumers.

In addition to the developer efforts, our driver team has developed a next-generation automatic shader optimizer that vastly improves GeForce FX pixel shader performance across the board. The fruits of these efforts will be seen in our Rel.50 driver release. Many other improvements have also been included in Rel.50, and these were all created either in response to, or in anticipation of the first wave of shipping DirectX 9 titles, such as Half Life 2.

We are committed to working with Gabe to fully understand his concerns and with Valve to ensure that 100+ million NVIDIA consumers get the best possible experience with Half Life 2 on NVIDIA hardware.