It is understood that Intel planned to accumulate Nvidia for $20 billion (about 27.7 trillion won) 20 years ago. Nevertheless, this was canceled resulting from opposition from the board of directors. Currently, Nvidia’s market capitalization has exceeded $3 trillion (roughly KRW 4,160 trillion), which is greater than 150 times greater than that on the time.
The Latest York Times reported this on the twenty fourth (local time), citing people related to Intel’s board of directors.
The title of the article is ‘Why Intel fell behind within the AI chip boom.’ In accordance with this, former Intel CEO Paul Otellini proposed a plan to accumulate Nvidia to the board of directors in 2005. On the time, some Intel executives also understood that NVIDIA’s GPUs would play a vital role in data centers and would play a vital role in the synthetic intelligence (AI) market in the longer term.
At the moment, NVIDIA was considered a ‘area of interest’ player available in the market. GPUs were mainly used for computer gamers, and were only partially applied to fields that required large amounts of calculations, reminiscent of oil and gas exploration.
Intel’s CPUs are excellent at quickly executing calculations one after one other, but NVIDIA GPUs are excellent at parallel tasks that distribute calculation tasks into tons of or 1000’s of tasks. GPUs received lots of attention a couple of years later with the rise of artificial intelligence (AI).
Nevertheless, it is understood that the board of directors expressed strong opposition to the plan to accumulate NVIDIA, which was only a brand new company on the time, for an enormous amount of $20 billion.
Ultimately, the transaction couldn’t even be attempted, and as an alternative Intel supported an internal project called ‘Larrabee’ to switch the GPU. The project was led by current CEO Pat Gelsinger, and although a few of the technology was applied elsewhere, the project was eventually scrapped.
One one that participated within the board of directors on the time recalled this as “a fateful moment.” CEO Otellini, who argued for the acquisition of Nvidia against the board of directors, was dismissed.
Since then, Intel has acquired startups within the AI field, including Nirvana Systems and Movidius in 2016 and Habana Labs in 2019. Nevertheless, there isn’t a company that may compare to NVIDIA.
As well as, a story emerged last August that the chance to accumulate Open AI was also lost. Reuters reported that Intel discussed acquiring a 15% stake with OpenAI in 2017 and 2018 for $1 billion in money, however the deal fell through resulting from a call made by Intel CEO Bob Swan on the time.
Intel’s market capitalization fell below $100 billion resulting from poor performance together with evaluations that it did not properly reply to the recent AI boom. Also, there was even talk recently that Qualcomm would propose an acquisition after the presidential election.
CEO Gelsinger said at a recent conference, “NVIDIA is much ahead within the AI competition,” and added, “We won’t find a way to compete without delay.”
The NYT, through comments from greater than 20 former Intel managers, board members and industry analysts, identified that Intel had experienced a series of missed opportunities, poor decisions and poor execution.
Based on many years of success and high profits, the corporate is alleged to have developed a company culture of ‘the biggest single-celled organism on Earth’, that’s, an infant-only company.
It also said its attempts to turn out to be a frontrunner in AI chips have repeatedly failed, and latest investments have been disregarded from protecting and expanding the x86 architecture, the mainstay of the corporate’s money.
Reporter Lim Da-jun ydj@aitimes.com
