Source: Wall Street See
Nvidia designs the GB200 server rack itself, which may make it harder for customers to switch to alternative products.
$NVIDIA (NVDA.US)$Competing with AI server manufacturers makes it even harder for customers to switch to alternative products.
On Wednesday, according to technology media The Information, Nvidia plans to design server racks for its upcoming flagship AI chip GB200, a job that has long been done by server design companies.$Dell Technologies (DELL.US)$, $Hewlett Packard Enterprise (HPE.US)$ and $Super Micro Computer (SMCI.US)$Earlier this year, Nvidia asked its server design companies to use its server rack design, but Microsoft wanted to use its own design, and the two sides could not agree. Finally, Nvidia backed down.
Server manufacturers such as Supermicro have benefited from the growth in Nvidia chip sales, but the new plan could put pressure on their profit margins.
The report said that Nvidia's move is one of several initiatives aimed at leveraging its strong position and developing new sources of revenue and profit, and may make it harder for its chip customers to switch to alternative products.
This year, Nvidia asked its server design companies to use its server rack design.$Microsoft (MSFT.US)$However, Microsoft wanted to use its own design, and the two sides could not agree. Finally, Nvidia backed down.
The news was a conclusion reached by two Nvidia employees involved in the program who were interviewed by the media. Neither company commented on the matter. On Tuesday, shares in server companies and Nvidia rose sharply, with Nvidia's market cap surpassing $3.33 trillion, making it the world's most valuable company.
Editor/tolk