Gavin Baker+ Your Authors @GavinSBaker Husband, Becky Painter. CIO, Atreides Management. Former PM, Fidelity OTC fund. No investment advice, views all my own. gavin-s-baker.com/ Apr. 30, 2020 1 min read + Your Authors

1) "You want to cheat the laws of physics, you don't want to confront them." - Jensen Huang

Great interview for anyone interested in semiconductors and datacenter architecture.

 https://www.nextplatform.com/2020/04/27/nvidia-plus-mellanox-talking-datacenter-architecture-with-jensen-huang/ 

2) Vastly more venture $ have gone into AI accelerators vs. SmartNICs which will help "cheat the laws of physics" by putting more processing and intelligence in the network.

Suspect SmartNICs will end up being a much better investment.

3) History of semiconductors suggests it is really hard to dethrone a dominant incumbent.

CPUs: ARM couldn't displace x86 in PC/Server, x86 couldn't displace ARM in handsets, AMD has never displaced Intel in x86.

Similar story in GPUs & basebands - same #1, same architecture.

4) ARM may finally begin to impact x86 in 2021 with the Macbook processors and Gravitron et al. But it took *way* longer than I ever would have expected.

5) Rather than trying to dethrone a dominant processor incumbent with a variety of AI accelerators, better to create and define a new category - SmartNICs - that could be a $5 billion plus TAM.

There will be a few winners - Cerebras, Habana among them - but only a few.

6) Suspect the best AI accelerator startups that don't hit escape velocity will be acquired by large hyperscale companies as the savings from eliminating all costs other than design/manufacturing really help with the economics.

7) i.e. Merchant silicon has to be 2x more performant per watt per $ just to be breakeven vs. internal silicon like the TPUs. Which is why all hyperscale cloud companies have internal programs albeit with varying degrees of commitment.

8) I might rephrase "The Moon is a Harsh Mistress" as "Tick Tock is Harsh Mistress." 😀

Science Fiction reference, but the modern semiconductor industry is the closest thing to magic in the world today.

Also: Tick Tock not TikTok.

9) More thoughts on the brutal treadmill of the modern semiconductor industry here:

 https://medium.com/@gavin_baker/thoughts-on-nvidia-ray-tracing-and-modern-semiconductor-realities-436d161b8817 


You can follow @GavinSBaker.



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