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Tech design and development seems, to me at least, pretty much naturally opposed to the "being kept in check with competition" state - as design isn't really a

by kimixa 3y ago

Tech design and development seems, to me at least, pretty much naturally opposed to the "being kept in check with competition" state - as design isn't really a cost that scales per-unit, the company that sells slightly more can afford to put more into development at the same per-unit margin, which snowballs. At some point, they own the entire market - or enough that they functionally control it, and start leveraging this position. I'd argue we're seeing this from Nvidia right now. People talk about AMD being competition - but from most stats I've seen, they're ~10% of dGPU sales, with Nvidia being the other 90% (with new Intel offerings being pretty much noise now). That means that if they invest the same proportion into development, NVidia nearly have 10x the resources. It may be that tech companies like this would "naturally" form a monopoly without outside (IE government) interference, as the only reason that multiplier of development resources doesn't completely crush new entrants is rather extreme mismanagement, or a new segment is created where the design resource don't really cross over that much. I don't see anything like that happening in the short term, if anything there seems to be more opportunity for cross pollination of development within these corporations, as there's a fair bit of design similarities between various silicon (GPUs, CPUs, accelerators for the current ML techniques etc.) that may encourage more consolidation in the whole semi market to take advantage of that, not less. But again the only thing stepping in the way of that seems to be governments trying to keep national interests, like the blocking of NVidia buying ARM to pull in one of the big CPU players. Plus all their other IP that they may benefit from, like low power GPU designs or other accelerators ARM have designed.

tm-guimaraes 3y ago
At the end of the day, what nvidia does is just producing IP. All manufacture is by other companies. This means that nvidia capital is spend on testing/development infrastructure and creative labor. So, you don’t need monopoly breaking to handle nvidia if it keeps growing, but instead rethink IP laws. Testing infrastructure is less capital investment than production manufacture. (See ASML and TSMC beeing booked), and humans can be persuaded to work elsewhere. This means Nvidia cannot fall a sleep, even if they keep snowballing. In a few years a rival can always arrive, or current ones snag key people or have dev/test infra breakthrough, or IP law could change as its critics rise every year. Sure, if Nvidia keeps its good game it will keep on growing and get even bigger share, but if it doesn’t, it will happen what happened with intel, intel got greedy on its position, and the company got fat. As long as nvidia keeps its game, it’ll be good for customers even if they swallow more market share, as prices are always limited by the value business customers get from AI, and the investment needed for a competitor is not even close to infrastructure or resource extraction stuff like high end chip fabs, oil extraction, energy grids, telecom grids. Again, Nvidia does not produce any physical goods, only designs.
- kimixa 3y ago
  I think Intel having in-house manufacturing was one of the big causes of them getting "Too fat and slow to respond" - from the outside much of their fall from grace was due to massively delayed production improvements rather than designs and IP. As far as I can see, the architectures were pretty much done and ready to go, just the expected targeted process missed it's mark. With Nvidia and other GPU competitors being IP-focused, effectively outsourcing all this "manufacturing stuff" (to the same 3rd party much of the time), that's one less thing for them to keep up with, and one less think that'll hurt if they do start "falling asleep". I can't see this happening to Nvidia in quite the same way right now. My point was that not having manufacturing makes advantages of consolidation larger, not smaller. I wonder what would have happened if Intel realized it's manufacturing wasn't hitting targets and "quickly" added TSMC as an option, would AMD even have had a chance with ryzen? There was clearly a time when AMD had superior manufacturing processes through them, if Intel's designs of the time were on the same process would they have managed to grab the headlines? And no, I Strongly disagree that NVidia running unchecked over the entire market being "Good for consumers", and not sure if the capital expenditure of getting over this moat is really much smaller than things like resource acquisition or infrastructure, they have $billions in current software ecosystems and hardware designs. Those $billions probably could buy you a fair bit of infrastructure investment on the scale you mentioned. Look how much Intel is burning right now just to get a toe into the market and not laughed out the door - and they're still clearly behind their competitors right now. Their chips aren't anywhere near competitive from a performance-per-area point of view, and their software is rather poor for the vast majority of use cases.

by kimixa 3y ago

tm-guimaraes 3y ago

At the end of the day, what nvidia does is just producing IP. All manufacture is by other companies. This means that nvidia capital is spend on testing/development infrastructure and creative labor. So, you don’t need monopoly breaking to handle nvidia if it keeps growing, but instead rethink IP laws. Testing infrastructure is less capital investment than production manufacture. (See ASML and TSMC beeing booked), and humans can be persuaded to work elsewhere. This means Nvidia cannot fall a sleep, even if they keep snowballing. In a few years a rival can always arrive, or current ones snag key people or have dev/test infra breakthrough, or IP law could change as its critics rise every year. Sure, if Nvidia keeps its good game it will keep on growing and get even bigger share, but if it doesn’t, it will happen what happened with intel, intel got greedy on its position, and the company got fat. As long as nvidia keeps its game, it’ll be good for customers even if they swallow more market share, as prices are always limited by the value business customers get from AI, and the investment needed for a competitor is not even close to infrastructure or resource extraction stuff like high end chip fabs, oil extraction, energy grids, telecom grids. Again, Nvidia does not produce any physical goods, only designs.

kimixa 3y ago
I think Intel having in-house manufacturing was one of the big causes of them getting "Too fat and slow to respond" - from the outside much of their fall from grace was due to massively delayed production improvements rather than designs and IP. As far as I can see, the architectures were pretty much done and ready to go, just the expected targeted process missed it's mark. With Nvidia and other GPU competitors being IP-focused, effectively outsourcing all this "manufacturing stuff" (to the same 3rd party much of the time), that's one less thing for them to keep up with, and one less think that'll hurt if they do start "falling asleep". I can't see this happening to Nvidia in quite the same way right now. My point was that not having manufacturing makes advantages of consolidation larger, not smaller. I wonder what would have happened if Intel realized it's manufacturing wasn't hitting targets and "quickly" added TSMC as an option, would AMD even have had a chance with ryzen? There was clearly a time when AMD had superior manufacturing processes through them, if Intel's designs of the time were on the same process would they have managed to grab the headlines? And no, I Strongly disagree that NVidia running unchecked over the entire market being "Good for consumers", and not sure if the capital expenditure of getting over this moat is really much smaller than things like resource acquisition or infrastructure, they have $billions in current software ecosystems and hardware designs. Those $billions probably could buy you a fair bit of infrastructure investment on the scale you mentioned. Look how much Intel is burning right now just to get a toe into the market and not laughed out the door - and they're still clearly behind their competitors right now. Their chips aren't anywhere near competitive from a performance-per-area point of view, and their software is rather poor for the vast majority of use cases.