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> everyone who has so far proven unable to compete The article explains that Nvidia's biggest customers (50% of datacenter revenue) are switching to their own

> everyone who has so far proven unable to compete The article explains that Nvidia's biggest customers (50% of datacenter revenue) are switching to their own hardware.

kadushka 1y ago
Seems like the opposite to me: https://www.datacenterdynamics.com/en/news/google-in-talks-to-rent-nvidia-blackwell-gpus-from-coreweave-report/ https://www.datacenterdynamics.com/en/news/google-in-talks-t...
- voidspark 1y ago
  You linked to an article about Google renting an insignificant amount of additional capacity. Google runs AI / HPC workloads on their own hardware and has been doing that for more than a decade. Google Gemini was trained on TPUs developed in house. It does not run on Nvidia hardware.
  - stingraycharles 1y ago
    And I believe Apple refuses to use NVidia as well, they’re actually using Google’s TPUs. https://www.tomshardware.com/tech-industry/artificial-intelligence/apple-skips-nvidias-gpus-for-its-ai-models-uses-thousands-of-google-tpus-instead https://www.tomshardware.com/tech-industry/artificial-intell...
    - ryao 1y ago
      That was for training. For inference, they reportedly use their own silicon.
      - 7speter 1y ago
        There was a rumor that emerged a few weeks ago that they broke down and made an order from nvidia: https://finance.yahoo.com/news/apple-might-ai-game-1-195100330.html https://finance.yahoo.com/news/apple-might-ai-game-1-1951003... Before that, in a Wired article from 10 years ago about siri and ai, one of the apple higher ups was quoted bragging about having one of the baddest gpu farms around (paraphrasing)
    - saagarjha 1y ago
      Apple is definitely using Nvidia hardware.
  - kadushka 1y ago
    Google, last month: “we’re doubling down on our partnership with NVIDIA” https://blog.google/technology/ai/google-nvidia-gtc-ai/ https://blog.google/technology/ai/google-nvidia-gtc-ai/
    - voidspark 1y ago
      That's Google Cloud Platform. Of course they will provide Nvidia hardware as demanded by external customers. But their internal workloads and their frontier model (Gemini) runs on TPUs.
      - Jlagreen 1y ago
        Yes, but the cloud customers "who finance TPUs" have NO INTEREST in TPUs and in Nvidia GPUs instead. How does Google pay for TPUs internally? By Google Search and Google Cloud of course. Google Search uses TPUs, Google Cloud however has way more non-TPUs instances. What people forget, nobody wants to switch from CUDA dependency to SW dependency on Google/AWS/Azure. CUDA at least allows me to use it in consumer, in pro HW, in cloud and AND in on-prem data center. I'm really looking forward to Fortune 500 companies sending all their internal company data to Google to structure it to train custom AI models. Yeah, that will never happen. What happens instead is that Fortune 500 companies will build up AI expertise to build their own custom AI model and they will think hard if they want the training AI compute internally or on a cloud. Nvidia has a huge business of building data centers on-premises which people totally oversee. NO CSP will ever compete there because it's against their primary business model. A Reliance India contract from 2023 alone is a delivery of 2 million GPUs in a few years. That's probably more than Nvidia's last year's total revenue and that is 1 large corp in India only.
        twoodfin 1y ago
        That’s the fundamental premise of the article: The hyperscalers will consolidate GPU compute exactly as they consolidated all other forms of compute. Including highly sensitive compute like product design and customer databases. You can argue they won’t, but the “enterprises won’t put sensitive data in Cloud” ship sailed years ago.
monocasa 1y ago
And something like 90% of Nvidia's revenue at this point is from the datacenter market.
- solardev 1y ago
  As a gamer, I selfishly wish that Nvidia would go back to being a gaming company instead of a crypto and AI compute company. I miss MSRP graphics cards :(
  - Ekaros 1y ago
    I also miss sane MSRPs... I thought computers were supposed to get cheaper over time, not more expensive.
    - ksec 1y ago
      That stop happening a while ago. Newer chip are more expensive, as with memory.
  - ksec 1y ago
    Gentle reminder a lot of mid - lower end graphics card are far from MSRP. And arguably it is crypto and AI compute on server that partly subsided some of the R&D cost on consumer GPU.
almostgotcaught 1y ago
NVIDIA ain't spent much time in the NFL else they would've known "...when you’re bleeding a guy you don’t squeeze him dry right away. Contrarily, you let him do his bidding suavely. So you can bleed him next week and the week after at minimum."
makeitdouble 1y ago
But then they're not boosting NVidia's competitors either, so wouldn't NVidia stay in the top position in their market ? The article seems focused more on stock price and where to bet, than the market for GPUs or generic hardware vendors.
- mycall 1y ago
  By switching to their own hardware, they become NVidia's competitors.
  - makeitdouble 1y ago
    That's kind of arguing that people cooking at home are restaurants' competitors. There's a kernel of truth in it, but if I was McDonalds I'd care a lot more about what KFC is doing than the market trends of cast iron pans.
    - brazzy 1y ago
      No, you wouldn't, not if that market trend causes your revenue to plummet. Changes in the size of the market matter just as much as market share.
    - voidspark 1y ago
      Bad analogy 90% of Nvidia's revenue is from datacenters. If the datacenters stop buying Nvidia's products, and use their own hardware instead, then Nvidia loses 90% of its revenue.
      - makeitdouble 1y ago
        > Nvidia loses 90% of its revenue. These 90% will be a flash in the pan, same way the COVID revenue was for mask sellers. Sure it feels bad from Nvidia's perspective, but we also can understand that the AI boom would not have kept Nvidia skyrocketing infinitely anyway.
    - prng2021 1y ago
mushufasa 1y ago
I'm skeptical of this. They have been doing this for a decade already. So far, those same companies have just become bigger and bigger customers of NVIDIA. NVIDIA is very strategic about building product to avoid commodification -- both by building out network effects where software is tied to their proprietary sdk libraries, and by always focusing on being at the cutting edge of product. Both these things can be true: a large company should try to build their own hardware to reduce supplier risk, and a large company should be open to suppliers that have better product that delivers business value. So far, these large companies' internal hardware has been useful internally but never a complete replacement for NVIDIA, which keeps staying at the cutting edge of new capabilities. NVIDIA already faced existential risk when Intel was commodifying all the dedicated motherboard components in the late 90s, 2000s, (like sound cards etc), so they're hyper-aware of this.
- tough 1y ago
  Google's Gemma new QAT training comes from google using their own TPU's don't know much about the rest tho
- voidspark 1y ago
  > So far, these large companies' internal hardware has been useful internally but never a complete replacement for NVIDIA Google use their own hardware for AI/HPC. Nvidia hardware is offered to external customers who demand it on Google Cloud Platform. The AI datacenter explosion has only occurred within the past two years. We are talking about plans that will take years to implement. The hyperscalers are trying to cut out Nvidia as soon as possible.
- loufe 1y ago
  I'm baffled seeing this. I'm absolutely convinced of Google value prop, knowing Gemini 2.5 pro was trained and inference is performed on their TPUs is enormous. It's far and way the best model (Claude still has my heart, but their usage limits and limited context can't compete). The company that can allow collaboration up the value chain only like Google can in this space right now is going to win. The author went over similar pushes by Meta, AWS, and Microsoft. Now that their eyes are on the prize, and the prize is so staggeringly big, I'm convinced of the threat to their moat.

> everyone who has so far proven unable to compete The article explains that Nvidia's biggest customers (50% of datacenter revenue) are switching to their own hardware.

kadushka 1y ago

Seems like the opposite to me: https://www.datacenterdynamics.com/en/news/google-in-talks-to-rent-nvidia-blackwell-gpus-from-coreweave-report/ https://www.datacenterdynamics.com/en/news/google-in-talks-t...

voidspark 1y ago
You linked to an article about Google renting an insignificant amount of additional capacity. Google runs AI / HPC workloads on their own hardware and has been doing that for more than a decade. Google Gemini was trained on TPUs developed in house. It does not run on Nvidia hardware.
- stingraycharles 1y ago
  And I believe Apple refuses to use NVidia as well, they’re actually using Google’s TPUs. https://www.tomshardware.com/tech-industry/artificial-intelligence/apple-skips-nvidias-gpus-for-its-ai-models-uses-thousands-of-google-tpus-instead https://www.tomshardware.com/tech-industry/artificial-intell...
  - ryao 1y ago
    That was for training. For inference, they reportedly use their own silicon.
    - 7speter 1y ago
      There was a rumor that emerged a few weeks ago that they broke down and made an order from nvidia: https://finance.yahoo.com/news/apple-might-ai-game-1-195100330.html https://finance.yahoo.com/news/apple-might-ai-game-1-1951003... Before that, in a Wired article from 10 years ago about siri and ai, one of the apple higher ups was quoted bragging about having one of the baddest gpu farms around (paraphrasing)
  - saagarjha 1y ago
    Apple is definitely using Nvidia hardware.
- kadushka 1y ago
  Google, last month: “we’re doubling down on our partnership with NVIDIA” https://blog.google/technology/ai/google-nvidia-gtc-ai/ https://blog.google/technology/ai/google-nvidia-gtc-ai/
  - voidspark 1y ago
    That's Google Cloud Platform. Of course they will provide Nvidia hardware as demanded by external customers. But their internal workloads and their frontier model (Gemini) runs on TPUs.
    - Jlagreen 1y ago
      Yes, but the cloud customers "who finance TPUs" have NO INTEREST in TPUs and in Nvidia GPUs instead. How does Google pay for TPUs internally? By Google Search and Google Cloud of course. Google Search uses TPUs, Google Cloud however has way more non-TPUs instances. What people forget, nobody wants to switch from CUDA dependency to SW dependency on Google/AWS/Azure. CUDA at least allows me to use it in consumer, in pro HW, in cloud and AND in on-prem data center. I'm really looking forward to Fortune 500 companies sending all their internal company data to Google to structure it to train custom AI models. Yeah, that will never happen. What happens instead is that Fortune 500 companies will build up AI expertise to build their own custom AI model and they will think hard if they want the training AI compute internally or on a cloud. Nvidia has a huge business of building data centers on-premises which people totally oversee. NO CSP will ever compete there because it's against their primary business model. A Reliance India contract from 2023 alone is a delivery of 2 million GPUs in a few years. That's probably more than Nvidia's last year's total revenue and that is 1 large corp in India only.
      - twoodfin 1y ago
        That’s the fundamental premise of the article: The hyperscalers will consolidate GPU compute exactly as they consolidated all other forms of compute. Including highly sensitive compute like product design and customer databases. You can argue they won’t, but the “enterprises won’t put sensitive data in Cloud” ship sailed years ago.

monocasa 1y ago

And something like 90% of Nvidia's revenue at this point is from the datacenter market.

solardev 1y ago
As a gamer, I selfishly wish that Nvidia would go back to being a gaming company instead of a crypto and AI compute company. I miss MSRP graphics cards :(
- Ekaros 1y ago
  I also miss sane MSRPs... I thought computers were supposed to get cheaper over time, not more expensive.
  - ksec 1y ago
    That stop happening a while ago. Newer chip are more expensive, as with memory.
- ksec 1y ago
  Gentle reminder a lot of mid - lower end graphics card are far from MSRP. And arguably it is crypto and AI compute on server that partly subsided some of the R&D cost on consumer GPU.

almostgotcaught 1y ago

NVIDIA ain't spent much time in the NFL else they would've known "...when you’re bleeding a guy you don’t squeeze him dry right away. Contrarily, you let him do his bidding suavely. So you can bleed him next week and the week after at minimum."

makeitdouble 1y ago

But then they're not boosting NVidia's competitors either, so wouldn't NVidia stay in the top position in their market ? The article seems focused more on stock price and where to bet, than the market for GPUs or generic hardware vendors.

mycall 1y ago
By switching to their own hardware, they become NVidia's competitors.
- makeitdouble 1y ago
  That's kind of arguing that people cooking at home are restaurants' competitors. There's a kernel of truth in it, but if I was McDonalds I'd care a lot more about what KFC is doing than the market trends of cast iron pans.
  - brazzy 1y ago
    No, you wouldn't, not if that market trend causes your revenue to plummet. Changes in the size of the market matter just as much as market share.
  - voidspark 1y ago
    Bad analogy 90% of Nvidia's revenue is from datacenters. If the datacenters stop buying Nvidia's products, and use their own hardware instead, then Nvidia loses 90% of its revenue.
    - makeitdouble 1y ago
      > Nvidia loses 90% of its revenue. These 90% will be a flash in the pan, same way the COVID revenue was for mask sellers. Sure it feels bad from Nvidia's perspective, but we also can understand that the AI boom would not have kept Nvidia skyrocketing infinitely anyway.
  - prng2021 1y ago

mushufasa 1y ago

I'm skeptical of this. They have been doing this for a decade already. So far, those same companies have just become bigger and bigger customers of NVIDIA. NVIDIA is very strategic about building product to avoid commodification -- both by building out network effects where software is tied to their proprietary sdk libraries, and by always focusing on being at the cutting edge of product. Both these things can be true: a large company should try to build their own hardware to reduce supplier risk, and a large company should be open to suppliers that have better product that delivers business value. So far, these large companies' internal hardware has been useful internally but never a complete replacement for NVIDIA, which keeps staying at the cutting edge of new capabilities. NVIDIA already faced existential risk when Intel was commodifying all the dedicated motherboard components in the late 90s, 2000s, (like sound cards etc), so they're hyper-aware of this.

tough 1y ago
Google's Gemma new QAT training comes from google using their own TPU's don't know much about the rest tho
voidspark 1y ago
> So far, these large companies' internal hardware has been useful internally but never a complete replacement for NVIDIA Google use their own hardware for AI/HPC. Nvidia hardware is offered to external customers who demand it on Google Cloud Platform. The AI datacenter explosion has only occurred within the past two years. We are talking about plans that will take years to implement. The hyperscalers are trying to cut out Nvidia as soon as possible.
loufe 1y ago
I'm baffled seeing this. I'm absolutely convinced of Google value prop, knowing Gemini 2.5 pro was trained and inference is performed on their TPUs is enormous. It's far and way the best model (Claude still has my heart, but their usage limits and limited context can't compete). The company that can allow collaboration up the value chain only like Google can in this space right now is going to win. The author went over similar pushes by Meta, AWS, and Microsoft. Now that their eyes are on the prize, and the prize is so staggeringly big, I'm convinced of the threat to their moat.