Every commercial landscape is defined — and advanced — by the rivalries it contains.
From Coke to Pepsi, Nike and Adidas, McDonald’s and Burger King, the list goes on. These competitors have pushed each other to innovate, improve customer experiences, and expand their market presence.
But when those rivalries occur within a transformation shift, that is when things start to get interesting. Take for example the era-defining rivalry between Walmart and Amazon at the turn of the 21st century, characterized by the two company’s efforts to dominate both online and offline retail at the advent of internet — a battle that is still ongoing today.
It is unlikely that the eCommerce and online shopping experiences, with their realm of conveniences enjoyed today by hundreds of millions of consumers around the world, would be possible were it not for the two American retail heavyweights duking it out over the course of two-plus decades.
And as the artificial intelligence (AI) era progresses, a new battle is shaping up as would-be rivals continue to evolve their strategies to gain a competitive edge.
One of the more interesting pairings to watch in the fast-evolving AI landscape will be between Nvidia and OpenAI.
Just as, in many ways, the battle between Amazon and Walmart shaped the whole of the internet, the dynamics between OpenAI and Nvidia will ultimately transform commercial and consumer AI.
After all, AI, which requires accelerated computing to run, is seen by many as a natural progression, or a phase step up, of the internet’s own foundational computing and information layers.
Read more: Nvidia’s Blowout Earnings Cement AI, Accelerated Computing as Foundational Shifts
Winner Takes All
And there is one area where Nvidia is already a clear winner, and where OpenAI will be hard-pressed to catch cup in the near term: profitability and valuation.
While OpenAI is valued at an admittedly eye-popping $80 billion or more, Nvidia on Thursday (Feb. 22) joined the $2 trillion club, adding the value of over four OpenAI’s to its own market cap in just one trading session.
Nvidia is a leading technology company known for its graphics processing units (GPUs) and hardware solutions, while OpenAI is primarily known for its work pioneering AI research and the development of commercially advanced language models and other foundational AI systems.
OpenAI, like much of the AI landscape, relies on Nvidia GPUs to power its models and build its systems.
And while the two companies are not direct rivals in the traditional sense of sharing — and fighting over — the same net-zero customer audience, they are increasingly coming into contact as AI marches forward.
That’s because, while previously OpenAI represented the software pillar of the landscape and Nvidia represented the hardware pillar, the lines between the two are beginning to blue as resources become scarce and valuations skyrocket.
Read more: It’s a ’90s Browser War Redux as Musk and Meta Enter AI Race
Nvidia, for example, last week (Feb. 13) launched its own chatbot, directly competing with OpenAI’s flagship ChatGPT product. What’s more, the Nvidia chatbot is meant to be used on OpenAI-partner Microsoft’s Windows PCs, allowing users to connect to open-source ChatGPT competitors like Mistral or Llama 2, per Nvidia’s site page.
“We have the speed, scale, and reach to help every company in every industry become an AI company,” said Jensen Huang, founder and CEO of Nvidia, on Wednesday (Feb. 21).
And the chipmaker is putting its money where its mouth is, investing in 35 AI startups during 2023.
As PYMNTS reported, Nvidia’s portfolio features investments in Hugging Face, a provider of data and tools for AI developers, and CoreWeave, a cloud infrastructure company specializing in high-performance computing applications that depend on Nvidia’s GPUs, per the report. Recently, Nvidia made a substantial investment in Mistral, a Paris-based AI startup valued at €2 billion (about $2.2 billion).
Both Hugging Face and Mistral compete with OpenAI.
But OpenAI is hardly sitting still. While Nvidia dominates the chip market with a global market share of greater than 80%, OpenAI CEO Sam Altman is reportedly looking for up to $7 trillion in funding for a project that would allow OpenAI to increase the marketplace’s capacity for chipmaking.
At the same time, Nvidia’s CEO has said that those plans, and their price tag, aren’t exactly on the money.
Still, no matter how the landscape shakes out, the competition is sure to be good for both company’s end users as they push the frontier of innovation forward.
Wanda Parisien is a computing expert who navigates the vast landscape of hardware and software. With a focus on computer technology, software development, and industry trends, Wanda delivers informative content, tutorials, and analyses to keep readers updated on the latest in the world of computing.
