Intel’s New Lineup To Threaten Nvidia’s Leadership In The HPC Market

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This week, Intel (NASDAQ:INTC) announced a number of new and enhanced technologies, challenging Nvidia’s (NASDAQ:NVDA) leadership and enhancing its position in the high-performance computing (HPC) co-processor market. In addition to sharing additional details for its “Knights Landing” platform (a 14 nm product), Intel announced the “Knight Hill” platform  (10 nm) for its Xeon Phi co-processor line used in HPC  supercomputer systems. “Knight Hill” will be the successor to Intel’s “Knights Landing” product, which is expected to start shipping in commercial products next year onward. The company also discussed its new architectural and performance details for its Omni-Path Architecture, a new high-speed interconnect technology optimized for HPC deployments, and announced new software releases and collaborative efforts designed to make it easier for the HPC community to extract the full performance potential from current and future Intel industry-standard hardware.

Currently, Nvidia has a dominant share in HPC, thanks to the launch of its Tesla co-processors in 2010, which combines the company’s GPU with software to provide HPC acceleration. Intel has been trying to challenge Nvidia’s position in HPC accelerators with its Xeon Phi co-processors, launched in 2012.

Our current price of $34 for Intel is almost in line with the current market price.

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The HPC Market Is Expected To See A Major Uptick In Accelerator Adoption In 2015

According to the TOP500 supercomputer ranking, 62 of the world’s top 500 supercomputers use some kind of co-processor or accelerator. Of this around 67% make use of NVIDIA GPUs and 25% have implemented Xeon Phi as the co-processor/acceleration option. Both IDC’s High Performance Computing group and Intersect360 see strong growth for the accelerator/co-processor market now and in years ahead. According to IDC, the number of new implementations using these technologies jumped from 28.2% in 2011 to an incredible 76.9% in 2013. [1]

However, only a little over 12% of the Top500 list of supercomputers make use of accelerator co-processors. This seemingly low figure reflects the fact that, in recent years, compute intensive functions have been integrated in the Central Processing Unit (CPU, or the core microprocessor complex). Yet the availability of the compute-optimized Tegra and Phy devices has produced a shift back towards the use of co-processors as accelerators.  As a results, some analysts expect the HPC market to see a major uptick in accelerator adoption in 2015. ISC’s Top500 shows the performance share of accelerated systems matched with the top ten supercomputer rankings that shows quite clearly that these are the key piece for high performance. 9 out of 10 of the systems are outfitted with GPUs or Xeon Phi. [1]

Nvidi’s Tesla Processor Compatibility Can Pose A Threat To Intel

Nvidia clearly has had the first-mover advantage with the more recent adoption of accelerators as co-processors in HPC platforms. The company just unveiled the Tesla K80, a high-end HPC co-processor said to deliver 8.7 teraflops of single-precision throughput (74% above the prior-gen K40). In its recently announced Q3 2015 earnings, Tesla processors witnessed another quarter of strong earnings as high performance computing customers and deployed large Tesla co-powered systems. Recently, IBM unveiled its first Open Power based system featuring Tesla GPU accelerators which can significantly enhance Java, Big Data and technical computing applications. IBM announced plans to accelerate their enterprise applications using Tesla GPUs, including their nearly pervasive IBM DV2 with Blue database software. According to IDC, 32% of all HPC computing systems are IBM implementations. [2]

Nvidia recently announced that its Tesla processors are to be compatible with  the various ARM-based server MPUs in development, which constitue both an alterntive and possibly a threat to Intel’s x86 architecture. The ARM/Tesla approach is already gaining traction, and is planned to be used in a next-generation supercomputer that is to be built in Barcelona. Currently, Intel derives a very small portion of its revenue from the HPC market (so does Nvidia), but the fact that ARM-based low powered processors are threatening to take even more of Intel’s business is a cause of concern for the company. [3]

Nevertheless, with new upcoming platforms Intel is confident of competing and challenging Nvidia’s dominance in the HPC accelerator market. Its upcoming Knights Landing product combines both the CPU and the accelerators, possibly posing even more of a threat to NVIDIA. [3] Recent high-profile Knights Landing deals include the Trinity supercomputer, a joint effort between Los Alamos and Sandia National Laboratories, and the Cori supercomputer, announced by The U.S. Department of Energy’s (DOE) National Energy Research Scientific Computing (NERSC) Center. Additionally, DownUnder GeoSolutions a geosciences company, recently announced the largest commercial deployment of current-generation Intel Xeon Phi coprocessors, and the National Supercomputing Center IT4Innovations announced a new supercomputer that will become the largest Intel Xeon Phi coprocessor-based cluster in Europe. [4]

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Notes:
  1. Are Supercomputing’s Elite Turning Backs on Accelerators, HPC Wire, June 26, 2014 [] []
  2. Nvidia’s CEO Discusses F4Q2014 Results – Earnings Call Transcript, Seeking Alpha, February 12, 2014 []
  3. Can Nvidia Outsmart Intel in High-Performance Computing?, The Motley Fool, July 18, 2014 [] []
  4. Intel Reveals Details for Future High-Performance Computing System Building Blocks as Momentum Builds for Intel Xeon Phi Product, Intel Newsroom, November 17, 2014 []