UPDATED 08:00 EDT / MARCH 24 2017

CLOUD

Nvidia graphics chips accelerate their ascent to the cloud

Nvidia Corp. started out making graphics chips for gaming, and years ago it leveraged the processing power of those chips to sell into data centers as they became the go-to silicon to power the branch of artificial intelligence called deep learning. Now, graphics processing units are rapidly moving up into the cloud.

Today, Nvidia announced a deal with Tencent Holdings Ltd., China’s largest social media and online entertainment company, to make its most powerful GPU chips available in the Tencent Cloud. Its customers can tap the Pascal architecture chips to run deep learning neural networks for image and speech processing, intelligent customer services and other applications.

Tencent is the first top-tier cloud provider to offer them via the cloud, but surely not the last. “It’s indicative of what we’re seeing in the broader market,” Ian Buck, general manager of accelerated computing at Nvidia, told SiliconANGLE. “The new use cases of AI are showing up everywhere.”

The deal is the latest in a drive by Nvidia since at least last September to get its GPUs into all the major cloud providers’ data centers for rent. On Monday, Nvidia and Microsoft Corp. unveiled a new GPU accelerator for Microsoft’s Azure cloud. According to Global Equities Research analyst Trip Chowdhry, the software giant is doubling the size of its Nvidia GPU clusters as “the demand to run Machine Learning/Deep Learning continues to grow exponentially.”

Last month, Google Inc. announced plans to offer higher-performance Tesla chips in its cloud. Nvidia also has arrangements with cloud leader Amazon Web Services. And Tencent isn’t its only partner in China. Alibaba Group Holding Ltd. also uses Nvidia GPUs for its cloud.

“It’s been an accelerator for our business,” Buck said of the move by cloud providers to offer GPU-based computing services. Indeed, the trend has helped reshape the company. Nvidia Chief Executive Jen-Hsun Huang said during a conference call last November that the GPU has “really reached a tipping point. The GPU is no longer a niche product. We’re now a computing platform company.”

In its latest quarter, its data center business, driven largely by the demand by cloud providers for deep learning horsepower, grossed $296 million, more than triple the fourth quarter of 2015. “If they keep growing at this pace, and it could, it will be a $2 billion-a-year business that has gone from nothing to something in short order,” Patrick Moorhead, president and principal analyst at Moor Insights & Strategy, told SiliconANGLE.

As for Tencent, cloud services are an increasingly important part of its business. In its fourth fiscal quarter, reported Wednesday, the company attributed a 47 percent jump in profits partly to strong cloud revenues. And it’s upping its AI expertise as well. On Wednesday, the company said it hired Zhang Tong, who had led Baidu Inc.’s Big Data Lab, to run its AI program.

Image: Nvidia

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