Does the acquisition of Arm give NVIDIA the keys to autonomous driving?


Given the extensive investments by OEMs and tier 1s in
Arm core-based hardware-software architectures, and Arm’s extensive
CPU IP expertise, the battle lines in autonomy between NVIDIA and
Mobileye/Intel will be redrawn.

US-based NVIDIA’s announced agreement to acquire UK-based Arm
from SoftBank is a significant development for automotive
electronics. Arm brings CPU intellectual property (IP) expertise
that has enabled low-powered, embedded solutions, and NVIDIA’s
graphics processing unit (GPU) IP expertise has enabled accelerated
computing and artificial intelligence. Assuming no regulatory
issues prevent the deal from going through, the combined company
will bring together unprecedented IP resources, ecosystem partners,
and technology. However, the regulatory issues cannot be
discounted, especially given the current political tensions.

There are reasons to continue supporting Arm after the
acquisition just as before, and NVIDIA says it plans to continue to
support Arm’s business model and that overall Arm IP is shipped in
the tens of billions of integrated circuits (ICs) annually, whereas
NVIDIA ships about 100 million ICs. Continuing the Arm model could
also allow NVIDIA to expand the reach of its GPU IP, assuming
others are willing to use its CUDA platform. So, that would be
another source of revenue for NVIDIA for maintaining the status
quo. Additionally, continuing to support the automotive
semiconductor suppliers allows NVIDIA’s reach in that segment to go
beyond autonomous driving applications. To put the automotive
impact into context, NVIDIA’s fiscal second-quarter automotive
revenue was USD111 million, which is 2.87% of its total revenue
(USD3.9 billion) for the quarter. This acquisition will impact
automotive, but that may not have been the primary reason NVIDIA
announced it is acquiring Arm.

Possible consequences

What are some of the possible consequences of this development
for the rest of the automotive system-on-chip (SoC) suppliers and
their customers? Assuming NVIDIA’s focus remains primarily on
autonomy, Arm cores can be used in powertrain, advanced driver
assistance systems (ADAS) applications, and other applications
outside of infotainment and autonomy, without any direct
competitive pressure from or to NVIDIA. Given the investments that
OEMs and tier 1s have made in Arm-based solutions, they will do
everything they can to keep that core viable and available. The
automotive industry has made a significant software investment in
Arm’s architectures and they will not allow that investment to be
wasted.

Given that most of the OEMs and tier 1s are using Arm cores
today and are on their roadmaps for the future, it would be
difficult to change from that architecture. From a competitiveness
standpoint, NVIDIA would benefit little by squeezing out all the
other automotive semiconductor suppliers. The size of the 2019
automotive SoC market is USD3.3 billion, of which NVIDIA has about
a 10% market share, mostly in infotainment, which is less of an
area of focus than autonomy in the future for NVIDIA. If NVIDIA
limited access to Arm cores for the rest of the automotive
semiconductor suppliers to strengthen its position in autonomy, it
would be at the expense of all the other automotive applications
moving to Arm, and its customers would work hard to prevent this.
If successful, NVIDIA’s main competitor would be Mobileye/Intel.
Against Mobileye/Intel, NVIDIA benefits by there being more users
of Arm to keep the ecosystem healthy, which is one of the reasons
Arm has been successful in automotive in the first place.

In the longer term, NVIDIA’s acquisition of Arm may give impetus
for semiconductor suppliers to revisit the RISC-V open architecture
as an alternative core. Alternatively, perhaps MIPS or X86
architectures are looked to as a solution beyond Mobileye/Intel.
Both options existed before this acquisition as well. As the
accompanying graphic demonstrates, the attraction of Arm is that
multiple suppliers use it, which is one of the reasons the
ecosystem is extensive. It is an advantage to NVIDIA to continue
this use, so making the Arm core available to competitors makes
sense. Likewise, making the Arm core available should extend the
reach of NVIDIA’s GPU. Again, making the GPU available could become
another IP revenue stream. Lastly, having multiple suppliers on the
Arm core could allow NVIDIA to focus on autonomy applications yet
still obtain revenue from allowing other semiconductor suppliers to
focus on ADAS applications that are of less interest to NVIDIA.

Changing battle lines in autonomy

Regarding autonomous driving specifically, there has been a
division between the Mobileye/Intel camp and the NVIDIA camp.
Granted, high-performance SoC suppliers like Qualcomm and Samsung
have the capability to expand the competitors, and NXP moving to
five-nanometer technology should enable it to enter the fray as
well. Removing the semiconductor names in the accompanying chart
reveals that before and after NVIDIA’s announcement, the core
architectures in autonomous driving and even ADAS are essentially
Arm and MIPS/X86. Tesla’s own silicon is Arm based. So, the
architectural competition between Arm and MIPS/X86 does not change
this landscape. Unless a new architecture gets traction, the
previous battle lines in autonomy between Mobileye/Intel and NVIDIA
are redrawn and a line develops between MIPS/X86 and Arm
architectures.

NVIDIA’s automotive semiconductor competitors will not be
thrilled by the acquisition because it brings uncertainty and
changes the status quo. However, the trend of software being more
the differentiator than hardware has been ongoing, and this
development does not materially change that. Undoubtedly, there
will be renewed interest in cores beyond Arm. Perhaps NVIDIA
acquiring Arm will make it easier for OEMs that want to develop
their own SoCs, because NVIDIA can offer both IP and silicon
development. Of course, that all requires the initial dust to
settle and the regulatory issues to become clearer.

Source: AutoTechInsight from IHS
Markit




Posted 17 September 2020 by Phil Amsrud, Senior Principal Analyst – Automotive, IHS Markit



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