A big reason why Nvidia (NASDAQ: NVDA) is currently the undisputed leader in the software-related AI accelerator market. The company’s CUDA software platform, which enables developers to write applications that use Nvidia GPUs to accelerate workloads, has been widely used in academia and industry for nearly two decades. CUDA has become the de facto standard and only works with NVIDIA products.
When the AI boom began in late 2022, Nvidia’s GPUs and CUDA platform represented the path of least resistance. There are capable AI accelerators from competitors including Intel (NASDAQ: INTC) and Advanced micro devicesand cloud giants like Alphabet are increasingly designing their own custom AI chips. However, the CUDA software platform effectively locks users into using Nvidia GPUs.
An industry-wide revolt
For the past few years, Intel has been working on oneAPI, an open specification that is at the heart of the company’s effort to launch an alternative to CUDA. oneAPI is multi-architecture, meaning a single code base can be used on all CPUs, GPUs and other types of chips, and multi-vendor, meaning it aims to support chips from any company. This is in stark contrast to CUDA, which is locked to Nvidia GPUs.
Intel is far from the only company that wants to see the dominance of Nvidia’s AI accelerator decline. At the end of 2023, Intel came together with Arm HoldingsAlphabet’s Google, Qualcomm, Samsung, and several others to form the Unified Acceleration Foundation (UXL). The fundamental goal of this union is to build an open software ecosystem for all accelerators. Intel’s oneAPI is at the heart of these efforts.
For companies like Google, which buy mountains of Nvidia GPUs to run AI workloads for themselves and their cloud clients, having alternatives to Nvidia could significantly reduce costs. For companies like Qualcomm and Samsung, breaking CUDA’s iron grip on the AI accelerator market increases the likelihood that their products will become more popular.
Samsung has concrete plans to enter the AI accelerator market in early 2025 with the launch of its Mach 1 chips. Although Samsung’s first effort will focus on AI inference rather than AI training, the software ecosystem will ultimately determine whether the chip is successful .
Meanwhile, Qualcomm is focused on integrating artificial intelligence into all of its chips, an effort that will require software support to pay off. “We’re actually showing developers how to migrate from the Nvidia platform,” Qualcomm’s head of AI and machine learning said in an interview with Reuters.
Intel can profit most of all
Intel is going at the AI market in a number of ways. The company sells its Gaudi line of AI accelerators and builds AI chips into its latest processors.
While industry-wide efforts to break CUDA’s dominance will make Intel’s products more attractive, the semiconductor foundry company stands to benefit the most. Intel plans to technologically overtake the foundry TSMC with its Intel 18A process at the beginning of 2025 and wants to become the world’s second largest foundry by 2030. The more competitive the AI accelerator market, the more chips that have built-in AI capabilities, the more potential customers for Intel’s foundry.
While a more competitive AI chip market could hamper Intel’s market share in AI accelerators, the company’s foundry opportunity is huge. Global foundry spending topped $100 billion in 2022 and is expected to more than double to $231 billion by 2032. In the long term, Intel’s foundry could generate tens of billions of dollars in revenue annually.
It will take time for the anti-CUDA effort to gain traction. UXL aims to get the specifications for its open alternative to a mature state by the end of the year, an eternity in the fast-paced world of artificial intelligence. It will take even longer for developers to get involved in numbers large enough to matter.
But the reward for this effort will be a more competitive AI chip market. For Intel, a slew of AI accelerators trying to challenge Nvidia’s dominance could help boost the company’s foundry business for years to come.
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Suzanne Frey, CEO of Alphabet, is a member of The Motley Fool’s board of directors. Timothy Green holds positions at Intel. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Nvidia and Qualcomm. The Motley Fool recommends Intel and recommends the following options: long $57.50 January 2023 calls on Intel, long $45 January 2025 calls on Intel and short $47 May 2024 calls on Intel. The Motley Fool has a disclosure policy.
Intel is at the center of an industry-wide effort to end Nvidia’s AI dominance was originally reported by The Motley Fool