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I can think of no worse owner of ARM in this industry, with the possible exception of Qualcomm. If NVidia indeed wants to have a real foothold in the CPU space
by robert_foss 6y ago
I can think of no worse owner of ARM in this industry, with the possible exception of Qualcomm.
If NVidia indeed wants to have a real foothold in the CPU space, we would all be much better off if they went the RISC-V route.
- nicoburns 6y ago> we would all be much better off if they went the RISC-V route Or indeed just license ARM like everyone else. It's not like they can't use ARM without buying them.
- dralley 6y agoNvidia already has an ARM license, even.
- DaiPlusPlus 6y agoAnd despite that, Tegra isn’t all that great compared to Qualcomm and Apple. Why can’t NVIDIA make their own M1 competitor as it is right now?
- abainbridge 6y agoBecause that requires investment. If they make that investment and are wildly successful at taking market share from x86 then ARM will become a much more valuable company. Buying ARM allows Nvidia to capture that value. This is a real problem when some of that investment is porting/tuning various open source projects to make them run well on ARM. Such work would benefit the whole ARM ecosystem, including competitors who sell ARM based chips. At which point, owning ARM starts to look sensible.
- ksec 6y agoHaving an ARM license has zero relationship with performance. An ARM license is only for unit cost benefits. Nothing else.
- sam_bristow 6y agoAlso strategic reasons. If you own ARM you can dictate the direction they're focussing on a lot more.
- deleted 6y ago[deleted]
- vondur 6y agoThe Tegra's aren't that bad are they? The CPU in the Xavier seems pretty decent, and it's only on a 12nm process. If they can get that shrunk down, it'd probably run even better.
- m-p-3 6y agoBut if they own it they'll have the sweet licensing money coming in.
- autoditype 6y agoOh right, what B schools call, 'extracting the economic rents'. It makes sense why they'd want to purchase ARM, but to pay for the price/future earnings of this acquisition, I guess they'd need to increase the price of future licenses
- ksec 6y agoWhich wouldn't work, the whole ARM business Model has safe guards for their customers so they cant suddenly rise the price and extract as much as they could. ARM is a first and foremost a British Company, not very good at extracting every single ounce of profits like their cousins.
- laurencerowe 6y agoI’m not sure ARM could have grown to the point it has without those safeguards. If they were to extract every ounce of profit their customers probably wouldn’t have picked them. Their model has been far more successful than most of their contemporaries.
- wizzwizz4 6y agoBut it's slower. What about those quarterly profits‽
- yehaaa 6y agoExactly, which raises the question why they are interested in buying Arm to begin with. A public statement is in the article: "With its proposed acquisition of Arm, NVIDIA will be able to turn new AI possibilities into realities much faster." Which doesn’t make much sense to me, unless they wish to change aspects of Arm that is currently outside of any license.
- ksec 6y ago>which raises the question why they are interested in buying Arm to begin with Softbank needs to liquidate some of its asset due to the genius work of con-man WeWork losing them tens of billions. The original purchase price for ARM was something like 100 - 120 P/E in 2016. And the current earnings are still 100 -120 P/E with no immediate or short term profits growth. The prospect of the company's fundamentals and future growth hasn't changed since 2016. Who in the right mind would want to buy a company for P/E 100+ with no visible growth factor? And since no one wants to buy it, Softbank had to find a buyer. Softbank is one of the largest shareholders in Nvidia. And with its current stock price that was a perfect fit. Of course that is ignoring Nvidia could have said No. I guess Softbank could decide to liquidate its position on Nvidia instead.
- rrss 6y agogoogling "softbank stake in nvidia" gives me "SoftBank Sells Entire Nvidia Stake" from 2019: https://www.wsj.com/articles/softbank-sells-entire-nvidia-stake-11549462246 https://www.wsj.com/articles/softbank-sells-entire-nvidia-st... Is your information about SoftBank being a major shareholder in nvidia up to date?
- ksec 6y agoThank You for Fact Checking. Looks like I was wrong about Nvidia ( My memory might have mixed up a few things ). But the ARM P/E point still stands. Feeling bad for spreading misinformation. :( I will need to double check on Son, Softbank and Nvidia again.
- IshKebab 6y ago
- freeAgent 6y agoThey already have ARM SoCs which are used in their own Shield TV and other devices.
- PaulHoule 6y agoI think this acq was about this: back in the old days Masayoshi Son would have found a knife in his room and been expected to use it on himself if he hadn't been able to find a lot of money quick to handle redemptions in the vision fund. Thus whoever bought ARM was doing him a big personal favor that would ultimately get repaid. NVIDIA does not need or want ARM but Son pretty much owes Huang his life now. (Patronage Networks are a good master narriative for how any society works.)
- Keyframe 6y agoI think it's more of Nvidia wants to get into ARM's sales channels. CPU side of things is additional benefit.
- robert_foss 6y agoThe things is that NVidia by being a competitor in many spaces, would wreck those very same sales channels.
- tyingq 6y agoI wondered about that. If AMD previously wanted to leverage their experience with Ryzen/EPYC to do something with an ARM core, would they now balk?
- GoOnThenDoTell 6y agoThey’d just do RISCV instead
- odiroot 6y agoHow about Broadcom (assuming they'd be big enough)?
- robert_foss 6y agoYeah, that would be pretty shit. But Broadcom has been reinventing itself as an IP company, so at least it wouldnt be a terrible match.
- AntiImperialist 6y agoI can think of one worse owner of ARM: AMD. Make that two: Intel.
- ckdarby 6y ago> I can think of no worse owner of ARM in this industry Can you further expand on this? I didn't see any evidence or even opinions backing this in the comment.
- datameta 6y agoARM made an architecture and CPU/GPU designs for others. They really had no stake in the chip making game, instead having others - Samsung, Apple, Qualcomm, Huawei, Mediatek, Rockchip, etc make the chip (that being a list of competitors for Nvidia). Their business model was in making the ARM ecosystem available for all manufacturers (including Nvidia) in order to sell licenses. This, I think, is the primary reason ARM chips dominate at this moment.
- tsomctl 6y agoARM makes their money by licensing the design to other huge companies, who then integrate the processor with other peripherals and manufacture it. They have no interest in extracting money from the end user, instead the documentation is readily available. In comparison, Nvidia, for example, sells you a video card, then you have to pay them again for a license to do deep learning. Oracle requires the end user of Java to pay a license to use the JRE. The fear is that if Qualcomm or Nvidia buy ARM, they're going to turn ARM into a similar business model where they try to nickel and dime the end user for everything.
- rektide 6y agoNvidia as a company is notorious for keeping a tyrannical grip on their customers, systems, & hardware. CUDA is a wonderful software stack, with massive hardware adoption... tied very strongly to Nvidia hardware. Nvidia GPUs are wonderful pieces of hardware... with frustrating Linux drivers, dogged resistance to open-source driver efforts, & a history of resisting mainstream collaboration & doing things themselves (their EGLStreams vs DMA-BUF/GBM, which, after half a decade+ of making Nvidia on Linux semi-useless, is finally showing signs of retreat. i'll allow that their devs may have had some points, perhaps?). Nvidia is one of the only companies with a proprietary interlink system, NVLink, whereas historically IBM (OpenCAPI), HP (GenZ), AMD (not anymore alas, with HyperTransport giving way to Infinity Fabric, so sad), great collaborations (CCIX/CXL), countless others promoted & used open interlinks, neutral technology that enabled & drove innovation & jump started the personal computer revolution ("gang of nine"[1]). Nvidia releases no documentation for their chips. If you buy a Nvidia computer- very powerful, energy efficient dev boards- Linux4Tegra is expected, woe be unto those who try to venture out & use the common Linux distros they already know & love. In Stratchery's wonderful write up of how quixotic & weird & strange the Nvidia acquisition of ARM seems[2], Ben highlights CEO Haung's core interesting idea of this acquisition: "Arm’s business model is brilliant. We will maintain its open-licensing model and customer neutrality, serving customers in any industry, across the world, and further expand Arm’s IP licensing portfolio with NVIDIA’s world-leading GPU and AI technology." And I'd love to expound on how weird, how strange this sounds. But Ben's done it far better than I could: "Notice that last bit: Huang is not only arguing that Nvidia will serve Arm customers neutrally, but that Nvidia itself will adopt Arm’s business model, licensing its IP to competitive chip-makers. It’s as if this is an acquisition in reverse: the $318 billion acquirer is fitting itself into a world defined by its $40 billion acquisition. Color me skeptical; not only is Nvidia’s entire business predicated on selling high margin chips differentiated by highly integrated software, but Nvidia’s entire approach to the market is about doing what is best for Nvidia, without much concern for partners or, frankly customers. It is a luxury afforded those that are clearly best in class, which by extension means that sharing is anathema; why trade high margins at the top of the market for low margins and the headache of serving everyone?" I would LOVE to see Nvidia acquire arm & gain a soul, figure out what it means to innovate, openly, to drive tech forward while working hand in hand with others to see it get adopted & grow & thrive, in ways far beyond their own limited control & vision. Nvidia is up to great things, has such an amazing mastery of high technology that so few share, building amazing chips, releasing amazing products. They are so integrative, building great chips (gpus & cpus both), building ways to make chips work together (nvlink), building consumer electronics (shield tablet, shield tv), building ultra-dense servers (dgx). But they do not share. "Take what you can, give nothing back!" is how a lot of people feel about Nvidia, and on many days I share that view. It's so hard to imagine. It would be such a change. Ben tails the end of his write-up with a wonderful question posed to Huang, why does Nvidia need to own ARM? Huang comes up with great answers, seems very thoughtful, and I am excited to see his future, as he talks about it happen. But it would not be Nvidia as we know it any more doing this. The company would need to be reborn, be something else. Huang seems to get that, he sees and says that, but it seems just so much more probable that the real end would be a miserly, sad fate for ARM, performance going up yes, but control & closeness shutting down the relevance & interestingness & availability & affordability. [1] https://en.wikipedia.org/wiki/Extended_Industry_Standard_Architecture#The_%22Gang_of_Nine%22 https://en.wikipedia.org/wiki/Extended_Industry_Standard_Arc... [2] https://stratechery.com/2020/nvidias-integration-dreams/ https://stratechery.com/2020/nvidias-integration-dreams/
- HissingMachine 6y agoARM is unique that there aren't many companies that could own it and it being a raw deal, it would have to be a company that doesn't have rivals in semiconductor or hardware space, so that basically rules out even buyers like Google or Microsoft. What that leaves are investment companies like Softbank or Berkshire, everything else is hurting someone.
- ineedasername 6y agoOr just let it go public. It doesn't have to be owned by anyone else.
- Scipio_Afri 6y agoIt was public, it went private when Softbank bought it. No reason it can't go public again, though.
- QuinnyPig 6y agoIntel or Oracle would be two.
- kevingadd 6y agoThey already sell hundreds of millions of units of their SoCs - the Nintendo Switch runs on an (ARM-based) NV SoC for one example and has sold over 70 million units.
- seabrookmx 6y agoLots of Nvidia SoCs in cars too, Tesla's being one example.
- captaincrowbar 6y ago"Why don't they just switch to RISC-V?" is the new "This will be the year of Linux on the desktop".
- stjohnswarts 6y agoIntel would also be a bad merger.