Navigating the GPU Computing Wars

The GPU computing wars aren't just between AMD, Intel, and NVIDIA. This war isn't just between the imminent public cloud GPUs and NVIDIA. Nation-states are joining the mix because computing power and AI will define the next ten years, and pre-existing geo-political trends will push the GPU market to fragment. 

One of the unintended consequences of US restrictions on GPUs has been the rapid escalation of the GPU arms race. These restrictions have pitted countries against each other and against international cloud companies and NVIDIA. The US government's decision to annex NVIDIA as a national security asset, a move many consider unconstitutional, has further fueled this race, undermining the world's confidence in NVIDIA's ability to transact freely. 

The fear of falling behind in the AI race is about more than losing technological prowess. It's a fear that power, stability, and even national defense could be at stake. The concept of "Bring your own GPU" (BYOG) is positioned to dominate the global computing race, leading to a rapid fragmentation with prevailing players in both the hardware and GPU rental space. This global GPU footprint will mirror broader geo-political relationships that defined the world pre-H100 and A100. Moreover, the potential for several countries to misuse AI against their own citizens is a reality we cannot ignore. 

At Hydra Host, we are betting on data centers. A bet on data centers is a bet on NVIDIA. As competition for accelerators and GPUs heats up, NVIDIA will return to its reliable moat and bread and butter: data centers. As the public cloud pursues its budget GPUs and nation-state subsidies for commodity GPU alternatives, NVIDIA will remain the king and continue growing its data center footprint as the data center industry has no interest or capability of building its own GPU. You can see this clearly with NVIDIA's push towards fully incorporated builds like the GH200 and GB200. 

GPUs, being naturally agnostic and with a limited-to-zero need for associated cloud services, broke the back of a public cloud. There was no longer a need to stay locked in with these mega-cloud companies. GPU sets the computing world free. As a result, priorities have shifted, and non-GPU considerations are driving the global battle for data center capacity and GPU computing. 

Aaron Ginn, CEO