Big changes are happening in the world of computer chips. Intel has announced a new partnership with Nvidia that could shake up how data centers and computers are built. Instead of sticking to their old plans, these two giants are now working together on designing new CPUs with Nvidia’s high-speed NVLink technology. This comes just a few months after Intel had already been working with AMD and other companies on a different interconnect called UALink.

In their joint statement, Intel and Nvidia said they will work on multiple generations of custom products for both data centers and personal computers. Nvidia is also investing a hefty $5 billion in Intel stock as part of this deal. This move has raised some questions about what will happen to the UALink project, which was supported by many companies including AMD, Broadcom, Google, Meta, Microsoft, and others. UALink was meant to be an alternative to NVLink, but now it’s unclear if it will continue long-term support from Intel.

What Does This Mean for the Chip Market?

Analysts are watching this partnership closely. Some believe Intel might keep supporting UALink for now to ensure they can ship products while Nvidia’s new tech gets ready. Others think both interconnects will coexist in the market because different companies and products will need different options. Gaurav Gupta from Gartner mentioned that even companies involved in UALink, like Broadcom, are not committed solely to one technology. They often use both, depending on the project.

When news of the alliance broke, Intel’s stock initially jumped but then fell back. Experts say Nvidia’s move to work so closely with Intel shows Nvidia wants Intel to be a stable partner, at least for now. It also suggests Nvidia doesn’t see Intel as an immediate threat in artificial intelligence, which is a big focus for both companies. Having Intel involved keeps competitors like AMD on their toes, which benefits Nvidia’s position in the market.

Impacts for Buyers and Manufacturing

This partnership could affect how companies buy and use chips. For now, it’s uncertain what this means for Intel’s GPU division, especially since Intel’s Arc graphics cards are struggling. Some wonder if Intel will continue investing in making discrete graphics chips or focus more on CPUs and data center tech.

Another interesting point is that Intel will manufacture the chips created through this collaboration. But there’s no word on Nvidia shifting some of its other chips from TSMC, the current main supplier, to Intel’s factories. This could be a way for Nvidia to diversify its supply chain and avoid dependency on TSMC, especially since TSMC has recently raised its prices. Opening up a second manufacturing option might help Nvidia save money in the long run.

Despite past rivalries, this new partnership is seen as a surprising turn. Ten years ago, Nvidia and Intel even sued each other over patents. Now, they’re working together. Both CEOs expressed optimism about what this collaboration could mean. Nvidia’s Jensen Huang said it would bring together two top platforms to create a new era of computing, while Intel’s CEO highlighted their combined strengths in data centers and manufacturing.

Looking ahead, Intel’s recent investments—like a $2 billion boost from Softbank and nearly $9 billion from the US government—have helped improve its outlook after a tough period. But experts like Sag believe these changes won’t affect the product roadmap anytime soon. The new alliance is likely years away from producing tangible products, and it probably won’t solve current chip shortages or pricing issues right away.

Overall, this collaboration signals a new chapter for both companies. While it brings potential benefits, it also raises questions about market competition and supply chain strategies. For enterprise buyers and tech enthusiasts alike, it’s a story to watch as these industry leaders shape the future of computing technology.

Inspired by

• https://www.networkworld.com/article/4059448/intel-will-design-cpus-with-nvidia-nvlink-in-return-for-5-billion-investment.html

Sources

• gmpg.org
• moorinsightsstrategy.com
• gartner.com
• computerworld.com
• infotech.com