by Anton Shilov
12/10/2009 | 11:36 AM
One of the natural ways for Intel Corp. to obtain graphics and stream processing technologies after it cancelled its first iteration of Larrabee graphics processing unit (GPU) as a commercial projects is to acquire a leading-edge designer of graphics chips. However, Intel will not acquire Nvidia Corp., two analysts said.
“[We do not] believe that [delay of Larrabee] will open the door to an Nvidia acquisition by Intel. AMD, Intel, and Nvidia are all companies with significant expertise that are advancing the direction of computing in different areas, and in some cases, different directions,” said Jim McGregor, an analyst with In-Stat.
Jon Peddie, the principal of Jon Peddie Research, also does not believe that Intel may acquire Nvidia. Mr. Peddie brings five reasons why Intel will never acquire Nvidia:
“I need to say this again because it really is a critical difference in the basic philosophies of the two companies. None of the events of the past week have had anything to do with hardware design. Yes GPUs are hard to design. So are CPUs. So is any billion transistor part. Intel simply doesn't see a future for the conventional SIMD GPU architecture. Right or wrong, that's where their analysis leads them, and you can huff and puff about it all you want, Intel is not going to change its mind on that matter,” said Jon Peddie.
Obviously, the cancellation of the first-generation Larrabee as a commercial product (the chip itself will still be released for developers) does not automatically lead to acquisition of Nvidia, or any other graphics company, by Intel. It will surely lead to major reconsideration of roadmap by Intel itself.
Nvidia will continue to evolve its GPUs and other products. But what will happen to Nvidia when Intel finally releases its Larrabee? Intel will indisputably win some market share from Nvidia in the GPU space and by that time Nvidia will not have chipset business (circa 30% of revenue today). But the company is most likely to succeed in selling its chips in high-performance computing segment, so, by 2011 – 2012 timeframe Nvidia is unlikely to be considerably weaker financially than it is today. On the other hand, Nvidia does not have its own x86 central processing unit. If discrete graphics market shrinks further and the [CPU-] integrated graphics market grows [even] more, then Nvidia’s actual market share will be much lower than it is today, whereas R&D investments into graphics processing technologies will only get higher. That will be a radically different situation compared to nowadays.
No one knows what will happen then.