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Intel will possibly acquire NVIDIA

Reuters speculates Intel is set to acquire NVIDIA. The speculation arose when NVIDIA’s shares rose 8% to $30.62 on the NASDAQ. Approximately 20 million shares were traded according to Reuters. Intel representatives declined to comment while NVIDIA representatives were unavailable. Bill Lefkowitz, options strategist, vFinance Investments believes Intel will make the announcement tonight.

This is still speculation at the moment as NVIDIA was deemed too expensive to purchase.The article claims:

Some observers said that they doubt Intel would buy NVIDIA because it's too expensive. The company has a stock market capitalization of about $10 billion, which means it would demand a far higher price than what AMD is paying for ATI.

Nevertheless, if the acquisition were to happen it would be interesting to see what Intel has in store for NVIDIA, as Intel holds the majority of the graphics market.  Intel’s primary competitor, AMD, previously acquired ATI Technologies -- NVIDIA’s primary competitor. The proposed AMD and ATI merger is nearing its final stages at the moment.


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PFFFF
By Gigahertz19 on 10/4/2006 11:27:59 PM , Rating: 2
Nvidia is way to expensive for Intel to purchase for now at least, I'll eat my words though if this DailyTech rumor turns out to be true :)




RE: PFFFF
By jjunos on 10/4/2006 11:45:31 PM , Rating: 3
There isn't really anything that's "too expensive" for intel if you consider how much each company is actually worth.

On the other hand, how much intel is *willing* to pay is an entirely different thing.


RE: PFFFF
By SexyK on 10/4/2006 11:53:40 PM , Rating: 5
Looking at market cap, INTC is worth ~$120B while NVDA is ~$10B. On the other hand, AMD is worth around ~$12B and ATYT is worth around ~$5.5B. So intel would have to shell out ~1/12 of its value for nVidia while AMD is paying almost 1/2 of it's value for ATI.

Compared to the AMD/ATI deal, this is a drop in the bucket for Intel.


RE: PFFFF
By kamel5547 on 10/5/2006 12:08:53 AM , Rating: 5
Well... the bid would have to be a premium (30% maybe) to the current stock price, but it is well within Intels reach. The real question would would someone else bid against Intel (private equity maybe?). Owning the only independent video card firm would probably give people leverage in the industry...

The question also is would regulators allow it given Intels much stronger competitive position. Ic ould see the deal having troubles in Europe, Japan etc. where they are already in hot water over antitrust issues.


RE: PFFFF
By ani4ani on 10/5/2006 3:05:57 AM , Rating: 5
It is ironic how these like companies chase each other. I work for Siemens and that company is obsessed with GE and vice-versa. They buy X, we buy y....

It is a common joke that if GE went bust in 6 months, Siemens would hatch a way to do it in 3!


RE: PFFFF
By DannyChacko on 10/5/2006 8:39:18 AM , Rating: 1
AMD bought ATi to enter into the chipset market
Now they got a new enemy nVidia .
nVidia has done more for AMD than ATi has for intel so this may or may not be a good gamble .mind you i'm not saying that ATi is weak but nVidia is the king with a capital k.

Just imagine where AMD would be if nVidia had made nforce /nforce2 chipset exclusively for intel instead of AMD . Very few people would have bought Athlon XP


RE: PFFFF
By RandomFool on 10/5/2006 8:39:52 AM , Rating: 3
I think I read somewhere that NVIDIA wasn't interested in being bought unless they would remain in control of a large part of the company. That was during the AMD/ATI rumors though and things do change.

It doesn't seem to make much sense for Intel to buy Nvidia since they already do just about everything Nvidia can do except for mid and high end graphics cards.


this doesn't make much sense
By johnsonx on 10/4/2006 11:59:08 PM , Rating: 5
Like others have pointed out, Intel already makes graphics cores. If they wanted to compete with ATI/AMD and NVidia, it would cost them far less than $10 billion. Take the gpu and memory controller cores of their G965, double or quadruple everything to get enough pipes, shaders, and memory channels, shake off any limitations of being an integrated core, and they've got at the very least a decent mid-range chip. That's just the quickie start... a few more million and they can design a dedicated core from scratch. Way less than $10 billion.





RE: this doesn't make much sense
By yusuf on 10/5/2006 12:20:02 AM , Rating: 3
add to that that intel just recently signed an agreement with Imagination technology (makers of PowerVR) to license its technology, and even invest in the company.

http://xbitlabs.com/news/video/display/20061004055...


RE: this doesn't make much sense
By yusuf on 10/5/2006 1:11:57 AM , Rating: 3
and intel has been in the process of recruiting graphics engineers.

and one must consider what nvidia will gain out of this deal. it will definitely lose its market share in the AMD chipset department, its SLI will have to be opened up to work on other chipset if it wants to be used with AMD cpus. it won't gain in the intel chipset market, and if AMD keeps ATI graphics independent and intel keeps nvidia graphics independent (if it acquires it) then I don't see any gain for nvidia out of this deal at all.
being the sole independent high end chipset and graphics provider in the industry is a much more favorable position i think.


RE: this doesn't make much sense
By Thorburn on 10/5/2006 7:23:43 AM , Rating: 2
The big plus for Intel would be that discontinuing the NVIDIA AMD chipsets would REALLY hurt the Opteron, at least in the short term.
Near enough every board I can't think of for AMD 2 or 4S systems is NForce 4 Professional based.


RE: this doesn't make much sense
By DigitalFreak on 10/5/2006 8:29:38 AM , Rating: 2
Not really. Serverworks makes AMD chipsets. The HT-2000 and HT-1000, I believe. HP is using them on the new DL385 G2.


RE: this doesn't make much sense
By Thorburn on 10/7/2006 12:52:00 PM , Rating: 2
Hence I said nearly all :)

For workstations and the majority of servers I'd bet they are NForce based.


RE: this doesn't make much sense
By nerdye on 10/5/2006 12:28:48 AM , Rating: 4
You are certainly correct in the prospect of intel being easily capable of mid range to high end gpu's, but I doubt they could crank out anything more than a mid range gpu this moment. Give intel time, they are capable, buy nvida now for 1/12th of their total worth and gain roughly one 1/2 of the dedicated graphics market while NOT having to compete with nvida, that sounds like a good prospect for intel to me.


By doctor sam adams on 10/5/2006 9:19:38 AM , Rating: 3
Intel clearly lacks either the technology, expertise, or simple motivation of a dedicated graphics company. It has been saying for years that it wants to do "serious" graphics and has for years consistently churned out nothing but crap. It would likely have to spend a billion or more in R&D just to catch up to Nvidia, but buying it straight out would not only give it R&D but also knock a competitor out of the market. Worth 10 billion? No, but if there was another ATI to acquire, Intel might do it.


Hemogenization
By SeetheSeer on 10/4/2006 11:28:16 PM , Rating: 2
This would seriously change the gfx landscape...for the worse? The market would certainly beomce more hemogenized.




RE: Hemogenization
By FITCamaro on 10/4/2006 11:32:34 PM , Rating: 1
I'll be pissed. Because while I trust AMD to keep things open and keep ATI pretty much non-biased, I don't trust Intel to do the same.


RE: Hemogenization
By FuzionMonkey on 10/5/06, Rating: -1
RE: Hemogenization
By FITCamaro on 10/5/2006 10:46:34 AM , Rating: 3
I own a C2D system. How does my trust of one company over another make me a fanboy? I like AMD certainly, but I prefer the manufacturer with the faster processor over the brand on the box.

Does my trust of Mobil oil over Pennzoil(sp?) make me a Mobil fanboy?

Pfft. Idiots who make assumptions based on nothing.


RE: Hemogenization
By kkwst2 on 10/5/2006 12:33:47 AM , Rating: 2
So the graphics market would become blood-like?


RE: Hemogenization
By splines on 10/5/2006 12:58:42 AM , Rating: 3
You went for the lulz, but got the fail.

http://en.wiktionary.org/wiki/homogeneous


RE: Hemogenization
By Sebec on 10/5/2006 3:41:05 AM , Rating: 2
"Heme" refers to blood.


RE: Hemogenization
By nomagic on 10/5/2006 4:09:55 AM , Rating: 1
"Heme" does not refer to blood. It refers to the red complex iron-containing pigment, to which oxygen binds.

Sorry that I have to do this, but facts are facts...


By Xajel on 10/5/2006 12:17:57 AM , Rating: 2
I think I saw the inquirer reported that its hard for Intel to do such as merging because of all these anti-trust things she already have...




By Nimbo on 10/5/2006 12:58:21 AM , Rating: 1
quote:
these anti-trust things she already have

Intel as a female!


By AnotherGuy on 10/5/2006 3:04:21 AM , Rating: 2
lol ngtv nVidia is the female

its a she its a sheee


By hstewarth on 10/5/2006 9:57:15 AM , Rating: 2
AMD/ATI change every thing in respect to the case. Things are different now.

They allow AMD to take over ATI, so they should allow Intel to joined up with NVidia ( assuming that its true ).

I think it is bad idea for compnanies to merge like this because it limits customer choices and with AMD/AYI it gives AMD a chance to monopolize the market - because it force uses to to more likely use ATI GPU on AMD machines.


By Trisped on 10/5/2006 12:11:41 PM , Rating: 2
It is not the same. AMD is not the one with a monopoly on PC CPUs. AMD also is not the one with the most motherboard chipset and GPU market share. Intel, on the other hand, does have a monoploy on the x86 processor. It has something like 80% of the motherboard chipsets and video processers in current desktops. NVidia also has a major piece of the GPU and motherboard chipset market.

Anti-Trust laws are specificly designed to limit these types of mergers, where the #1 and #2 provider in the fields join to become more powerful then all their compeditors combined.

It isn't going to happen. The most that will happen is that Intel will buy a piece of NVidia and use that to create a special deal where NVidia will recieve extra benifits over ATI. I am trying to think of an example, but am having a hard time. Does anyone have one?


By deeznuts on 10/5/2006 12:58:24 PM , Rating: 2
Umm, 80% is not a monopoly buddy. A monopoly is when one has no alternatives or choice. A monopoly in and of itself is not illegal. It's not desired, but not illegal.

It is anti-competitive practices, used by anyone, but especially monopolies and companies with greater share (i.e. Intel) that is undesirable.

If you have company A, and company B, and company A's products are so superior that nobody buys B's products and they disappear off of the business landscape, what's wrong with that? It's just competition.

If company A uses anti-competitive practices (bribes, illegal discounts etc.) then we have a problem.

But I agree with the rest of your post. I don't see Intel doing a full purchase but maybe a partial buyout then a strategic alliance.


By Viditor on 10/5/2006 11:41:19 PM , Rating: 2
1. A monopoly in US anti-trust law is the ability to create a "barrier to entry". The US Commerce Dept suggests in their guidelines that any company with greater than 50% of the market is a monopoly, though the actual definition is based on the barriers to entry. Even a company with 100% of the market is not a legal monopoly if they are not able to effect a new entrants pricing and market gain.

2. Currently, the marketshares for graphics in PCs are:
Intel = 40%
ATI = 27%
Nvidia = 20%
Therefore,
AMD+ATI remains at 27%
Intel+Nvidia = 60% which is a danger of monopoly

3. There is 0% chance of this merger being allowed by the DOJ because
a.) Nvidia is the largest supplier of chipsets for Intels only rival, which allow them to control the market again.
b.) As Intel is already in litigation for anti-trust specifically (in many countries), the DOJ tend to be far more conservative in their judgements
c.) The marketshare of Nvidia and Intel combined is well into the "danger zone" for monopolistic control


The key word is "speculation"
By stmok on 10/5/2006 12:53:58 AM , Rating: 2
Until there is an official announcement from either Intel OR Nvidia. I'm gonna take this news with a grain of salt.

If it does get announced, Intel needs to get an OK from the legal side in regards to the effects on the competition, etc, and then shareholder approval. (Like what AMD is going through with their acquisition of ATI).





RE: The key word is "speculation"
By Chernobyl68 on 10/5/2006 2:14:44 AM , Rating: 4
i REALLY hope this isn't true. What happens to all the Nvidia chipsets out there, that run AMD CPUs? What kind of future development are they likely to have if they're owned by Intel?

Chern


RE: The key word is "speculation"
By shamgar03 on 10/5/2006 7:57:04 AM , Rating: 2
Agreed


Holy Smokes
By Tedtalker1 on 10/4/2006 11:28:52 PM , Rating: 2
If this happens we have something else in which to thank AMD.I love competition.It just keeps getting better and better.




RE: Holy Smokes
By MemberSince97 on 10/5/2006 1:48:27 AM , Rating: 3
No, Thank Mark Rein if this happens...:)


profit from rumours
By RedStar on 10/5/2006 9:25:42 AM , Rating: 5
some one is on the ball...buy nvidia stock then start a rumour it will be bought up by intel.

Stock rises a whopping 8% in just one day. Must be nice to have that kinda influence :)




I have no life
By maevinj on 10/4/06, Rating: 0
RE: I have no life
By slunkius on 10/5/2006 5:38:09 AM , Rating: 2
would you like a medal or something? cause you know, FIVE HOURS AGO!!!


RE: I have no life
By maevinj on 10/5/2006 7:44:27 AM , Rating: 2
Yes, where's it at?
My point was that daily tech should step it up a little bit.


Why??
By Mumak on 10/5/2006 8:38:06 AM , Rating: 2
I don't see a reason for Intel to buy nV. Intel is capable to create powerful graphics cores - the reason why the don't do this, is because they have it integrated inside the MCH. They need to keep it small and power-effective. I guess if they want, they would be able to produce discrete powerful graphics w/o nV. The only interesting area are the software/driver guys, that I believe are much better @ nV. But is that worth the price?




RE: Why??
By Calin on 10/6/2006 4:19:32 AM , Rating: 2
In the times when nVidia and ATI had a 6-months cycle between versions, they had two teams working on different generations (a team finish the GeForce3, starts working on GeForce5).
They probably do the same now, which means a team that worked together for a long time is able to churn a new class of graphic processors in about 18 months.
There is no way in hell Intel could release a powerful graphic core in less than those 18 months, especially starting from an graphic architecture with half a pair (like the one integrated in chipsets).
You could add pipelines and multiply the width of the graphics engine only up to a point (integrated video from NVidia and ATI has just to pixel pipelines, unlike the low-end graphic cards which have four pipelines).
Is Intel able to enter now in the low-cost graphics sector? Certainly. Is it able to enter in budget/mid-range gaming sector? In a year or so of preparations, probably. What about high performance gaming? Not at those times, but maybe the second generation of the mid-range could go there. However, you are looking at a three years wait until that, probably two years from the launch of their first mid-range gaming discrete graphic card.


Just imagine...
By Vidmar on 10/5/2006 8:42:58 AM , Rating: 2
Just imagine for a moment what nVidia could do with Intel's manufacturing capabilities......immediate jump to 65nm possibly??? Much cheaper chips for both CPU chipsets and GPUs…. Just think what might happen. I bet the anti-trust lawyers already have.




RE: Just imagine...
By mindless1 on 10/5/2006 6:42:16 PM , Rating: 2
Did the chips get much cheaper with any of their other process shrinks?

Fewer independent players in a market seldom works out well for consumers.


funny
By cciesquare on 10/4/06, Rating: -1
RE: funny
By BioRebel on 10/4/2006 11:58:09 PM , Rating: 1
I believe they copied a few things on the Athlon 64 line from intel.... did that fail?


RE: funny
By cciesquare on 10/5/2006 12:46:23 AM , Rating: 2
True.

I guess copying pays off lol


RE: funny
By BioRebel on 10/5/2006 9:55:50 AM , Rating: 2
Yes, well AMD didnt copy this round since they're not gluing cores together to make a multi-core CPU. So we'll just see who copy's who this round.


RE: funny
By RandomFool on 10/5/2006 8:35:51 AM , Rating: 3
How has AMD failed? Last I checke they were doing pretty good for themselves.


"A politician stumbles over himself... Then they pick it out. They edit it. He runs the clip, and then he makes a funny face, and the whole audience has a Pavlovian response." -- Joe Scarborough on John Stewart over Jim Cramer

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