NVIDIA to buy ULi
In a move that has taken
pretty much everyone in the IT industry by
surprise, NVIDIA has announced that it intends to buy ULi Electronics -
a firm that designs some of the cleverest core logic
found on today's motherboards.
NVIDIA openly recognises that a large proportion of chipset innovation
happens in the Far East where ULi is based - and that is one of the
things that made ULi an attractive proposition.
The move is seen by many as good sense on NVIDIA’s part as
its own in-house chipset makers are based solely in the USA.
ULi, in
contrast, has relationships with chipset makers in Taiwan
and China, as
well as in San Jose.
At an estimated cost of USD$52 million, the ULi buy-out offers
NVIDIA a relatively cheap foothold in the Taiwanese and Chinese
markets. The acquisition, set to go through in Q1 of NVIDIA’s
2007 fiscal year (that means April 2006), is still subject to clearance
by various government agencies in Taiwan but, seemingly, that
shouldn’t be a problem.
NVIDIA intends to combine and use the best of both companies’
assets - including ULi’s engineering, expertise and
contacts. With ULi’s pedigree of innovative chipset design,
NVIDIA should be a better position to create and sell
core logic for motherboards that use Intel CPUs - a sector
where NVIDIA currently has core-logic real estate on just
one high-end product. The expansion of the Intel core-logic
side of NVIDIA's business could be crucial given that the
company recently lost to ATI a massive deal with Intel for
integrated graphics chipsets.
Speaking to HEXUS.net this morning, Adam Foat, Product PR
Manager for NVIDIA said:
“
The acquisition of ULi will significantly enhance
NVIDIA’s core logic and MCP design team and, potentially, its
overall business. It will also significantly strengthen
NVIDIA’s sales, marketing and customer engineering presence
in Taiwan and China which is a critical business and engineering hub
for the PC industry. NVIDIA will acquire a suite of products and
technologies that are complementary to our current MCP business”
NVIDIA will also continue to support all ULi’s current
product range while the acquisition goes through and into the future
- developing new products using its newly-acquired assets.
Check back soon for more information and reaction from the industry on
this story.
UPDATE 1
We've now had the chance to gather some reaction from the industry but
are awaiting more.
Our first port of call was ATI - logical we thought when NVIDIA and ATI
are
the two big graphic companies and massive
rivals - the more so given ATI's own recent success in
securing that important deal to supply integrated
graphics chipsets for Intel motherboards.
Chris Hook, ATI Head of
Public Relations, EMIA, had this to say:
“ATI have a really strong platform and product road
map for the future. ATI’s success does not rely on third
party technology or expertise”
Thanks Chris - most helpful. Cough! So ATI looks like it was also
caught out by the news, otherwise something rather
more damning would likely have been ready. That said, we can understand
ATI thinking that the NVIDIA/ULi deal
doesn't threaten anything it has in the pipeline. ATI, though,
has regularly bought in technology it needed
for its chipsets and there's every reason to think it will do
so in future if the need again arise. NVIDIA's move amounts to much the
same thing and will, if the integration of ULi goes smoothly, help fill
in some of the gaps in its capabilities and product offerings.
An industry veteran of
some 30 years was somewhat less diplomatic than ATI (or, perhaps, a
little better prepared):
“You only buy a sandwich when there’s a
hole in your stomach! This appears to be a clear admission by NVIDIA
that they have serious deficiencies in their existing chipsets and they
need to make this kind of investment if they are to stand any chance at
all in the future. Defective armour is only one of a string of
embarrassments for their in-house chipset team. Let’s hope
for the sake of their customers that this acquisition is not a massive
white elephant. When Intel were looking for a chipset partner for their
DX9 products, NVIDIA couldn’t cut the mustard.”
We’re still waiting for comments from
AMD, Intel and others and will bring you those as soon as we
can.
What we did receive, though, were the off-the-record comments of a
significant interested party - comments that were
highly dismissive. To us, though,
that suggests not that NVIDIA's move is of no
consequently but, rather, that it is a cause for concern by the
company's rivals and those rivals' allies.
HEXUS.comment
We think that the NVIDIA buy-out of ULi is a sensible and rather astute
move. The acquisition may give NVIDIA not just a major leg
up in the Taiwanese and Chinese markets in general but also on
the
world stage. ULi's undoubted expertise can only benefit NVIDIA and
lead, we expect, to better and more trouble-free NVIDIA
products.
With only one high-end NVIDIA-based Intel-CPU motherboard
currently in existence, we're expecting NVIDIA to shortly
announce new products that will allow it to make significant inroads in
that sector. Those products, most likely, will be aimed at makers of
lower-budget motherboards - with the aim of
capturing a proportion of the
Intel market similar to that NVIDIA already holds for
motherboards using AMD CPUs.
It is interesting to note the comments from industry folk
quoted above. Disparaging as they first appear, could it be that
reactions of this sort, particularly the refusal to comment, mask
the concern of those parties? It remains to be seen
what NVIDIA does with
the technology and expertise it will gain from ULi. But, since
NVIDIA was smart enough to make the move in the first place,
it's a good bet that
it will have already have figured out some equally smart ways
to make use of its newly-acquired assets.
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(And we're talking something like 19 Mb a second, faster than a DVD stream...)Quote
I agree, the USB performance just doesn't matter in real world terms... Unless someone can tell me of an application where you'd NEED full USB speeds AND notice the difference?
(And we're talking something like 19 Mb a second, faster than a DVD stream...)
yea i feel the same way but review sites are giving it alot of stick for it, i dont really care much as long as it works fine. Which is why i wanted to buy Sapphire PI mobo but it just out of my budget at the moment i need the money for X1800XT and a decent AMD X2.Quote
there are a lot of ati-uli turion64 laptops about, which cause no end of trouble for linux users (uli chipsets are completely broken under linux)
damn software engineers always get this the wrong way round, linux is completely broken under some uli chipsets. Still there damn good imo espuesually when you look at price, just a pitty about linux's hardware management, if only they had some kind of generic layer, that provided, some generalisation and abstraction. That would be useful for this sort of thing!
But seriously good move by nVidia, company was growing, even if its not a 'partner' move, its a good aquisition.Quote
I agree, the USB performance just doesn't matter in real world terms... Unless someone can tell me of an application where you'd NEED full USB speeds AND notice the difference?
(And we're talking something like 19 Mb a second, faster than a DVD stream...)
Quite a agree, but what's more important - real world terms, or marketability?
Sata2 I can especially see as something PC world et al would like to stick on their adverts for systems.
NVidia are quite happy to bang on about any differing features regardless of how useful they are. We might not be swayed, but how much of the market do we represent?Quote
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