ED#78 : NVIDIA Is Really Buying AGEIA!

Back in April 2006, we made a shocking announcement that NVIDIA bought over AGEIA. Of course, it was only a joke, with a "belligerent" NVIDIA belting out gungho statements about wiping ATI and Canada off the map.

However, that joke was based on a real possible scenario, and it is one that many people feel was inevitable. After all, who would pay so much for a dedicated physics card with almost no support? If AGEIA failed to make inroads with the game developers, then the only real alternative is to sell out to either NVIDIA or ATI.

Of course, ATI was out of the equation once they merged with AMD. AMD-ATI have been cash-strapped since, and can hardly afford another merger/takeover. The only real possibility for AGEIA was NVIDIA. Hence, it was why did so many people who read it actually believed NVIDIA bought AGEIA, or were at least left wondering...

Fast forward to 2008. On February 4, NVIDIA officially announced that it has signed a definitive agreement to acquire AGEIA Technologies, Inc. Almost 2 years to the day we joked about that possibility, it finally became a reality. Take a look at their press release :

FEBRUARY 5, 2008 — NVIDIA (Nasdaq: NVDA), the world leader in visual computing technologies and the inventor of the GPU, today announced that it has signed a definitive agreement to acquire AGEIA Technologies, Inc., the industry leader in gaming physics technology. AGEIA's PhysX software is widely adopted with more than 140 PhysX-based games shipping or in development on Sony Playstation3, Microsoft XBOX 360, Nintendo Wii and Gaming PCs. AGEIA physics software is pervasive with over 10,000 registered and active users of the PhysX SDK.

“The AGEIA team is world class, and is passionate about the same thing we are — creating the most amazing and captivating game experiences,” stated Jen-Hsun Huang, president and CEO of NVIDIA. “By combining the teams that created the world’s most pervasive GPU and physics engine brands, we can now bring GeForce®-accelerated PhysX to hundreds of millions of gamers around the world.”

“NVIDIA is the perfect fit for us. They have the world’s best parallel computing technology and are the thought leaders in GPUs and gaming. We are united by a common culture based on a passion for innovating and driving the consumer experience,” said Manju Hegde, co-founder and CEO of AGEIA.

Like graphics, physics processing is made up of millions of parallel computations. The NVIDIA® GeForce® 8800GT GPU, with its 128 processors, can process parallel applications up to two orders of magnitude faster than a dual or quad-core CPU.

“The computer industry is moving towards a heterogeneous computing model, combining a flexible CPU and a massively parallel processor like the GPU to perform computationally intensive applications like real-time computer graphics,” continued Mr. Huang. “NVIDIA’s CUDA™ technology, which is rapidly becoming the most pervasive parallel programming environment in history, broadens the parallel processing world to hundreds of applications desperate for a giant step in computational performance. Applications such as physics, computer vision, and video/image processing are enabled through CUDA and heterogeneous computing.”

AGEIA was founded in 2002 and has offices in Santa Clara, CA; St. Louis, MO; Zurich, Switzerland; and Beijing, China.

Ignore the marketing hyperbole. AGEIA has waved the white flag, just as we thought they would 2 years ago. The real question is what is NVIDIA going to do with AGEIA's PhysX technology? Are they going to start adding PhysX co-processors to their higher-end boards, or are they thinking long-term with direct integration in future GPUs?

Also interesting would be ATI's response to this. Would they raise a ruckus over the acquisition, like Google is doing when Microsoft announced their bid to take over Yahoo? Or do they already have a secret weapon up their sleeves? One thing's for sure. Only one company has developed a physics processing chip, and AGEIA is it.

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