February 8, 2018
Nvidia has, what I believe to be, one of the most underrated monopolies in the computer market.
The graphics card market is essentially two companies, AMD & Nvidia. While AMD does well, they are the low-cost alternative, with a product line that lags significantly behind Nvidia.
When companies want cheap graphics cards that run hotter and don't do anything they couldn't have done three years ago, they buy AMD. This isn't a problem for things like an Xbox, which runs by itself in a large ventilated living room. However, when you want to run a 10,000 graphics card in a datacenter where raw computing power vs. heat generation is a critical metric, it is a problem. AMD card limitations also show when working with high-intensity computation, like that of a self-driving car.
Nvidia's success is very similar to Intel's in the CPU industry. Intel has market command with data center customers and the high-performance consumer market. Nvidia is the foundation for GPUs in data centers, which Google Cloud Platform, AWS, and Azure all using Nvidia for their highest-end computing options.
This business will only continue to grow at an ever-expanding rate as Moore's Law no longer can continue due to physics's fundamental laws. The future of computing power is in GPUs, and right now, Nvidia is the most respected and valued voice in shaping that future. It is also the powerhouse behind many consumer-focused GPU computing systems as:
I could continue with names of companies using Nvidia GPUs, but almost no major contender in the self-driving car market explosion that is about to happen uses a non-Nvidia card. Nvidia is a bet on not only self-driving cars but an index on the market size itself.
Finally, there is a lot to be said about the future of cryptocurrencies, but although consumers have shown to have an extreme level of risk, miners of the coin have significantly less. If miners can figure out energy consumption issues, which are becoming easier to solve with the accelerated advances in battery and solar technology, they almost always make money. Due to the competition in mining, most replace their hardware yearly. So it's fair to expect increases in the number of GPU cards being purchases each year as the rewards for mining cryptocurrencies increases. I believe this will hold even if the cryptocurrencies currently very popular (Bitcoin) fail, as the movement is too large to stop anytime soon.
Nvidia is the sole supplier of the most critical hardware for some of Silicon Valley's most lucrative and invested in spaces. I don't see anyone changing that any time.