$ 6.9 billion deal: why does a GPU developer buy network equipment manufacturer
Most recently passed the transaction Nvidia and Mellanox. We talk about the prerequisites and consequences.
Photo - Cecetay - CC BY-SA 4.0
Mellanox has been active since 1999. Today, it is represented by offices in the United States and Israel, but operates on a fabless model — it does not have its own production and places orders at third-party enterprises, such as TSMC . Mellanox manufactures adapters and switches for high-speed networks based on Ethernet and high-speed InfiniBand protocols.
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One of the prerequisites for the transaction is the general interest of companies in the direction of high performance computing (HPC). So the two most powerful supercomputers in the world, Sierra and Summit, use Mellanox and Nvidia solutions.
Photos - Carlos Jones - CC BY 2.0
The second significant argument in favor of the deal is Nvidia’s desire to outrun a potential competitor, Intel. The California IT giant is similarly involved in work on supercomputers and other HPC solutions, which in one way or another contrasts it with Nvidia. It turned out that it was in Nvidia that they decided to take the initiative in the struggle for leadership in this market segment and were the first to enter into a deal with Mellanox.
New solutions . High-performance computing in areas such as biology, physics, meteorology, and others. Every year they become more and more demanding and operate with increasingly significant amounts of data. It can be assumed that the cooperation of the teams of Nvidia and Mellanox will primarily give the market new solutions that will be relevant not only to hardware, but also to the segment of specialized software for HPC systems.
Integration of products . Such transactions often allow companies to optimize operating expenses by reducing the number of employees and improving the overall efficiency of business processes. In this case, one can only assume that this will be the case, but what is very likely is the integration of Nvidia and Mellanox solutions in “boxed” formats. On the one hand, this is an opportunity for customers to get fast results and ready-made technologies for solving problems here and now. On the other hand, there is a potential movement towards limiting the customization of a number of components, which not everyone can like.
Optimize east-west traffic . Due to the general trend in the growth of the volume of data being processed, the problem of so-called “ east-west ” traffic is becoming ever more acute. This is actually a “bottleneck” of the data center, which slows down the work of the entire infrastructure, including the solution of deep learning tasks. The combined efforts of the company have all the chances for new developments in this area. By the way, Nvidia and earlier paid attention to the optimization of data transfer between the GPU and at one time introduced the specialized technology NVLink .
Some time after the announcement of the Nvidia and Mellanox deal, other manufacturers of data center equipment, Xilinx and Solarflare, announced similar plans. One of the main objectives of the first is to expand the range of utilization of the FPGA in the framework of solving problems in the field of HPC. The second is optimizing the latency of server-based network solutions and is using FPGA chips in its SmartNICS cards. As in the case of Nvidia and Mellanox, this transaction was preceded by collaboration between teams and work on joint products.
Photos - Raimond Spekking - CC BY-SA 4.0
Another big deal is the purchase of HPE by BlueData. The latter was founded by former VMware employees and developed a software platform for "containerized" deployment of neural networks in the data center. HPE plans to integrate startup technologies into its platforms and increase the availability of solutions for working with AI and MO systems.
It is expected that through such transactions we will see new products for the data center, which one way or another should affect the efficiency of solving customer problems.
UPD: According to a number of publications, one of the shareholders of Mellanox is filing a claim for misinformation in the course of submitting financial statements before the transaction.
Our other materials about IT infrastructure:
Photo - Cecetay - CC BY-SA 4.0
What a deal
Mellanox has been active since 1999. Today, it is represented by offices in the United States and Israel, but operates on a fabless model — it does not have its own production and places orders at third-party enterprises, such as TSMC . Mellanox manufactures adapters and switches for high-speed networks based on Ethernet and high-speed InfiniBand protocols.
')
One of the prerequisites for the transaction is the general interest of companies in the direction of high performance computing (HPC). So the two most powerful supercomputers in the world, Sierra and Summit, use Mellanox and Nvidia solutions.
The companies also collaborate in other developments - for example, Mellanox adapters are installed in the DGX-2 server for deep learning tasks.
Photos - Carlos Jones - CC BY 2.0
The second significant argument in favor of the deal is Nvidia’s desire to outrun a potential competitor, Intel. The California IT giant is similarly involved in work on supercomputers and other HPC solutions, which in one way or another contrasts it with Nvidia. It turned out that it was in Nvidia that they decided to take the initiative in the struggle for leadership in this market segment and were the first to enter into a deal with Mellanox.
What will it affect
New solutions . High-performance computing in areas such as biology, physics, meteorology, and others. Every year they become more and more demanding and operate with increasingly significant amounts of data. It can be assumed that the cooperation of the teams of Nvidia and Mellanox will primarily give the market new solutions that will be relevant not only to hardware, but also to the segment of specialized software for HPC systems.
Integration of products . Such transactions often allow companies to optimize operating expenses by reducing the number of employees and improving the overall efficiency of business processes. In this case, one can only assume that this will be the case, but what is very likely is the integration of Nvidia and Mellanox solutions in “boxed” formats. On the one hand, this is an opportunity for customers to get fast results and ready-made technologies for solving problems here and now. On the other hand, there is a potential movement towards limiting the customization of a number of components, which not everyone can like.
Optimize east-west traffic . Due to the general trend in the growth of the volume of data being processed, the problem of so-called “ east-west ” traffic is becoming ever more acute. This is actually a “bottleneck” of the data center, which slows down the work of the entire infrastructure, including the solution of deep learning tasks. The combined efforts of the company have all the chances for new developments in this area. By the way, Nvidia and earlier paid attention to the optimization of data transfer between the GPU and at one time introduced the specialized technology NVLink .
What else is happening in the market?
Some time after the announcement of the Nvidia and Mellanox deal, other manufacturers of data center equipment, Xilinx and Solarflare, announced similar plans. One of the main objectives of the first is to expand the range of utilization of the FPGA in the framework of solving problems in the field of HPC. The second is optimizing the latency of server-based network solutions and is using FPGA chips in its SmartNICS cards. As in the case of Nvidia and Mellanox, this transaction was preceded by collaboration between teams and work on joint products.
Photos - Raimond Spekking - CC BY-SA 4.0
Another big deal is the purchase of HPE by BlueData. The latter was founded by former VMware employees and developed a software platform for "containerized" deployment of neural networks in the data center. HPE plans to integrate startup technologies into its platforms and increase the availability of solutions for working with AI and MO systems.It is expected that through such transactions we will see new products for the data center, which one way or another should affect the efficiency of solving customer problems.
UPD: According to a number of publications, one of the shareholders of Mellanox is filing a claim for misinformation in the course of submitting financial statements before the transaction.
Our other materials about IT infrastructure:
Source: https://habr.com/ru/post/450490/
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