The massive chipmaker may exit manufacturing business while GPU vendor mulls buying processor designer Arm
Two possible moves by Nvidia and Intel could portend significant changes in a global processor market long dominated by Intel.
The Lowdown: According to reports, Nvidia is considering acquiring chip designer Arm, while Intel is weighing giving up manufacturing its own products as its delays its next-generation 7-nanometer processors by about six months.
The Details: Giant Japanese tech company SoftBank, which bought Arm for $32 billion in 2016, is exploring either selling the company or taking it public, according to multiple recent reports. Bloomberg reported that Apple declined SoftBank’s approaches, but Nvidia, which makes GPUs for everything from game consoles to supercomputers, reportedly is exploring an acquisition.
Arm designs power-efficient processors that others, such as Samsung, Qualcomm, and Huawei, license to make their own chips. The company’s designs power most smartphones and tablets on the market, but in recent years Arm has expanded its reach into such areas as the Internet of Things (IoT), autonomous vehicles, artificial intelligence (AI), and supercomputers. (Japan’s Fugaku last month become the first Arm-based system to hit No. 1 on the Top 500 list of the world’s fastest supercomputers.)
A combination of Nvidia’s GPUs with Arm’s chip-designed capabilities would improve Nvidia’s competitive stance against the likes of Intel and AMD; AMD already produces its own GPUs, while Intel is in the process of developing graphics chips that could come in late 2021 or early 2022. Neither company has commented on the reports.
Meanwhile, Intel is continuing to struggle to get its 7nm processors to market. Intel for decades has used its manufacturing strength as an advantage over AMD and other rivals, but in recent years the dominant chipmaker has seen AMD and Arm make the move to 7nm faster. Now the next-generation processors aren’t expected until later in 2022 or early 2023. The problem is that the yield – the number of chips from manufacturing that can be accepted – is 12 months behind internal targets.
Intel CEO Bob Swan told analysts, journalists, and investors that Intel will continue to evaluate the best manufacturing route going forward, which could include continued internal efforts, going to external chip foundries, or a combination of both. Intel in recent years has begun to use third-party foundries to help close shortfalls in such products as PC chips as it worked to make the complex move from 14nm to 10nm and now to 7nm.
The Impact: Such moves could accelerate a reshaping of the global chip market and lead to a wider range of products for customers and channel partners. Intel for decades has dominated the PC and data center chip market, but the continued challenges in producing next-gen products could open doors for a reinvigorated AMD, which has muscled its way back into the PC and server chip market in recent years with its Ryzen and EPYC portfolios. Intel already is under increasing pressure in the server space from Arm and various chip-making partners, such as Ampere.
Nvidia, which for several years has put a focus on such emerging areas as AI and self-driving vehicles, could boost its fortunes by acquiring Arm, which could give it a more complete CPU/GPU platform to rival Intel and AMD and add more competition to the market.
The Buzz: “We will continue to invest in our future process technology roadmap, but we will be pragmatic and objective in deploying the process technology that delivers the most predictability and performance for our customers, whether that be in our process, external foundry process, or a combination of both,” Swan said during a conferencing call about Intel’s latest quarterly financial numbers.