Broadcom’s Tomahawk 5 Likely Marks The Beginning Of The End For Nvidia’s InfiniBand Business

This article was originally published on 8/17/2022 and is one of the key/foundational articles being provided for reference.

One of Nvidia’s (NVDA) strategic vectors, when it acquired Mellanox for $6.9B in 2020, was to increase its lock on data center customers by bundling Mellanox’s InfiniBand solutions with Nvidia GPUs and accelerators (hereafter referred to as accelerators for simplicity). Once customers committed to Mellanox’s InfiniBand solution, they were locked into Nvidia accelerators. Nvidia could get away with a ransom in these situations.

But customers, especially powerful customers, like Amazon (AMZN), Microsoft (MSFT), Alphabet (GOOG) (GOOGL), and Meta (META), do not like to be tied to proprietary solutions as doing so is not in their economic or strategic self-interest. Consequently, and due to their general dislike for non-industry standard solutions, data center customers have been pushing the industry toward more standardized network solutions based on Ethernet.

To be su…