Article reprint source: Metaverse IP Encyclopedia
Original source: Metaverse
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On October 17, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) announced new export control rules for advanced computing chips and semiconductor manufacturing equipment, restricting China's ability to purchase and manufacture high-end chips. The controlled products include but are not limited to Nvidia A100, H100, A800 and other GPUs and DGX/HGX systems that integrate these high-performance computing cards.
After the ban was introduced, Nvidia's market value evaporated by nearly 400 billion yuan overnight, which made the already "chaotic" semiconductor market "worse". Currently, facing the downward trend of the semiconductor market, manufacturers are bound to increase investment in the metaverse field that they have already laid out.
As the ultimate imagination of the end of the Internet, the metaverse has a large enough stage to attract a large number of technology companies to engage in related research, and to activate new technologies and applications such as AR/VR, blockchain, digital twins, and Web 3.0.
According to the study "Taking the Hyperbole Out of the Metaverse" released by Bain Consulting, the value of the metaverse may reach US$900 billion by 2030. Gartner also predicts that by 2026, 30% of corporate organizations around the world will have products and services for the metaverse.
Faced with such huge opportunities and prospects, we not only have higher expectations for the Metaverse, but many manufacturers are also flocking to it. However, the technical challenges faced by the implementation of the Metaverse will also reach unprecedented heights.
The Computing Challenge of the Metaverse
As we all know, the Metaverse has the characteristics of virtual-real integration, decentralization, diversified openness, and continuous evolution. With the iterative upgrade of new technologies and the integration and innovation of new applications, the connotation and extension of the Metaverse will continue to expand, which will also increase its demand for computing power.
In an interview, Raja Koduri, senior vice president and general manager of Intel's Accelerated Computing Systems and Graphics Group, said the Metaverse could be the next major computing platform after the World Wide Web and mobile, requiring a 1,000-fold increase in computing power from the current state-of-the-art.
One of the core elements of the metaverse is to create a virtual world based on computer graphics engines that is so realistic and immersive that it can be mistaken for reality. In the movie "Battle Angel Alita", each of the 130,000 hairs of the protagonist needs to be rendered separately. It takes 100 hours to render just one frame, and the overall rendering cost is more than 100 million yuan.
In addition, in addition to the rendering of the high-precision model itself, the Metaverse is also a place for real-time interaction among multiple people. Every time a single user's state changes in the scene and is synchronized to another user in the scene in real time, at least hundreds of millions of data will be recalculated and displayed. Such a huge amount of calculation cannot be supported by current computing power.
Although the pursuit of computing power seems "far away", we must never underestimate human pursuit and innovation in the field of semiconductors.
At present, some manufacturers are trying to make high-computing power and high-energy-efficiency chips for the next era, providing more powerful power for computing power, thereby supporting the continued development of metaverse-related technologies such as AI and cloud computing. Based on the open nature of the vast world of the metaverse, not only can the various types of computing power provided by CPU, GPU, DPU and other chips be put to good use, but it will also lead to fundamental changes in the semiconductor industry.
Semiconductor manufacturers layout the Metaverse
Faced with the huge challenge of the Metaverse in terms of computing power, semiconductor manufacturers have begun to make layouts in the fields they are good at. At present, we can see that manufacturers such as NVIDIA and Intel are actively expanding from computing chips to the Metaverse and artificial intelligence fields. Qualcomm and other manufacturers have entered the XR field and penetrated into Metaverse-related equipment.
Among them, NVIDIA launched the third-generation NVIDIA OVX computing system and the metaverse application platform Omniverse. Developers can create exclusive virtual assistants and digital humans more quickly on the OVX computing system equipped with Omniverse, and companies can also automatically generate digital twin advertising blockbusters of their products on the platform.
Nvidia's layout in the metaverse has always been clear, which is to integrate its unique advantages in graphics computing, AI, and GPU technology to provide one-stop solutions for companies in all walks of life.
Previously, Intel has integrated the concept of the Metaverse into reality. They co-organized the "Metaverse Slam Dunk Contest" with the Chinese Basketball Association. The event is based on Intel CPU+GPU, AI algorithms, and 5G+MEC technologies. It can achieve ultra-low latency motion capture posture resolution from terminal image acquisition to the edge, and drive Metaverse digital athletes in real time for video/VR live broadcasts.
Intel's understanding of the Metaverse is very pragmatic. Intel's core technology is the processor, and it solves the problem of source computing power based on its own core technological advantages.
Recently, AMD acquired open source artificial intelligence software company Nod.ai and startup Mipsology. Nod.ai mainly provides optimized AI solutions for large data center operators and other customers, while Mipsology mainly develops AI reasoning and optimization solutions and tools. The acquisition of these two companies will enable AMD to add more AI elements to its product matrix.
Judging from a series of acquisitions of AI-related companies, AMD will target Nvidia and focus its firepower on the AI field to ensure that it continues to be competitive.
Qualcomm, on the other hand, has chosen to empower the XR field and the edge. Its second-generation Snapdragon XR2 platform can be used to support the next generation of VR and MR devices.
Whether it is Qualcomm's technical support for XR devices themselves or the provision of open systems for developers, they are relying on their influence in the industry and the accumulation of upstream and downstream resources to build a broad XR platform and expand their business territory.
In this era of the Internet of Everything and intelligence, every field is filled with advanced technologies and diversified products. Overall, semiconductor giants have different understandings of the metaverse, but the end result is to create a metaverse world that is close to reality.
Semiconductor market cools, giants scramble for new blue ocean
However, is the giants' "rush" for the Metaverse just to realize that charming "new world"? Obviously, we must not forget that they are commercial companies, and their goal from beginning to end is profit.
In recent years, due to semiconductor product demand and production capacity issues, the global semiconductor market has been in an unstable state. According to data released by the World Semiconductor Trade Statistics (WSTS), the global semiconductor market size will reach approximately US$574 billion in 2022. However, they predict that the market size in 2023 will drop sharply to US$556 billion.
We can also see from the latest financial reports of several semiconductor manufacturers that the semiconductor market is experiencing a period of lows.
Intel's second quarter 2023 financial report showed that its quarterly revenue was US$12.9 billion, a year-on-year decrease of 15%; AMD's revenue in the second quarter of 2023 was US$5.359 billion, a year-on-year decrease of 18%; Qualcomm's total revenue in the third quarter of fiscal year 2023 was US$8.451 billion, a year-on-year decrease of 23%; Samsung Electronics' second quarter 2023 performance report showed that its semiconductor business lost US$3.34 billion in the second quarter, far lower than the profit of US$6.29 billion in the same period last year.
Compared with the above-mentioned manufacturers, Nvidia's financial report is like a breath of fresh air. Its second quarter 2023 financial report shows that its revenue in the second fiscal quarter was US$13.507 billion, a year-on-year increase of 101%. Nvidia's sudden rise is due to its long-term layout in the field of artificial intelligence. When ChatGPT became popular this year and generative AI spread all over the world, Nvidia, as the supporter behind AI computing power, naturally got the biggest dividend.
From the perspective of the overall market, more semiconductor manufacturers are actively seeking changes. After more than a decade of glory, the consumer electronics industry is inevitably heading towards a recession cycle. As the door to the Metaverse is about to open, it is not only the social giants with a massive user market that will benefit, nor is it just the interactive content service providers. More importantly, the global semiconductor industry chain will also usher in a huge incremental space. The future of this blue ocean must be immeasurable.
Final Thoughts
The semiconductor industry has always been the core of modern technology, and its future development trend will have a profound impact on the implementation of the Metaverse. At present, although the industry is facing many challenges from technological development to supply chain diversification and sustainable development, as various semiconductor manufacturers increase their R&D investment and improve their technology level, we believe that the entire semiconductor industry will enter a development "fast lane".
The Metaverse is the future of the Internet, and people's current understanding of it is just the tip of the iceberg. But we are convinced that with the joint promotion of technological evolution and human needs, the realization of the Metaverse scenario and the maturity of the Metaverse industry are only a matter of time. It is also important to note that as an extension and expansion of the real world, the huge opportunities and revolutionary value brought by the Metaverse have taken root in all walks of life.
