Nvidia pours $3.5 billion into MediaTek — company will adopt NVLink Fusion for its custom AI accelerators

(Image credit: Nvidia, MediaTek) Nvidia and MediaTek this week announced a major expansion of their partnership under which Nvidia is investing $3.5 billion in convertible bonds issued by MediaTek, while the latter adopts NVLink Fusion platform for its custom AI accelerators, local AI systems, and automotive platforms. On the one hand, MediaTek's adoption of NVLink Fusion enables it to design accelerators for Nvidia's fully developed rack-scale platforms. On the other hand, Nvidia gets a slice of the growing market of custom AI accelerators.Tom's Hardware Premium RoadmapsHaving become the world's largest supplier of AI accelerators, Nvidia does not have direct rivals of comparable size. However, in a world where custom AI accelerators are becoming more widespread as more companies see benefits in bespoke solutions, Nvidia must hedge against their rise and ensure that its addressable market expands even if it does not win every accelerator design. One of the ways to achieve this is to spread its NVLink Fusion platform beyond its own products and to popularize it among users of custom hardware. The deal with MediaTek is aimed at exactly that.AWS, Google, Meta, Microsoft, and now OpenAI are developing their own AI accelerators partly to reduce dependence on expensive merchant GPUs. Nvidia cannot necessarily prevent this trend, so NVLink Fusion gives it another strategy: if customers replace some Nvidia GPUs with their own XPUs, Nvidia wants those XPUs connected using NVLink, paired with Nvidia CPUs where appropriate, and deployed within Nvidia networking and rack architectures. Under the new arrangement, customers can bring an XPU architecture to MediaTek, then MediaTek and Nvidia will supply much of the technology surrounding the actual compute engine.MediaTek will use NVLink Fusion as the foundation for custom accelerators that can evolve alongside future Nvidia architectures. The platform includes the NVLink Fusion chiplet, which connects custom XPUs to Nvidia's NVLink scale-up fabric using electrical or photonic interconnects; NVLink-C2C, which provides high-bandwidth, energy-efficient links between XPUs, Nvidia Rosa CPUs, and other compatible processors; and Nvidia NVHBM, which enables customized memory configurations and reserves more silicon area for compute.Using Nvidia's NVLink Fusion platform for custom AI accelerators enables potential MediaTek customers to concentrate on their differentiated compute architecture while Nvidia and MediaTek provide connectivity, memory architecture, packaging, manufacturing, and rack-level technologies. Essentially, MediaTek's customers will get a pre-developed rack-scale platform for their custom AI accelerators, something they cannot get elsewhere. Since Nvidia tends to supply AI infrastructure platforms, not just AI accelerators, the deal with MediaTek fits perfectly into its strategy.It should be noted that while hyperscalers like AWS, Google, or Microsoft can develop their own rack-scale solutions for AI and other workloads, smaller companies barely have enough resources to develop the whole rack-scale machine using off-the-shelf components."MediaTek is one of the world's great semiconductor companies, with exceptional expertise in system-on-chip design, connectivity, leading performance and power efficiency," said Jensen Huang, founder and CEO of Nvidia. "Together, we are building platforms that bring Nvidia accelerated computing to new markets and give customers the freedom to create differentiated AI systems at enormous scale."Get Tom's Hardware's best news and in-depth reviews, straight to your inbox.The companies are also expanding their work on local AI computing. MediaTek previously collaborated with Nvidia on the GB10 Grace Blackwell Superchip powering DGX Spark. The collaboration was considered positive, so Nvidia and MediaTek now plan to cooperate on multiple generations of RTX Spark and DGX Spark processors for client systems, AI developer supercomputers, and enterprise workstations.Finally, Nvidia and MediaTek will continue their multi-generation automotive collaboration. MediaTek's Dimensity Auto platforms integrate Nvidia AI technologies and RTX graphics for intelligent vehicle cockpits and can operate alongside Nvidia Drive AGX. Future generations will continue to wed MediaTek's automotive SoC expertise with Nvidia's accelerated computing, AI, graphics, and software technologies to build more advanced software-defined and AI-powered vehicles. Follow Tom's Hardware on Google News, or add us as a preferred source, to get our latest news, analysis, & reviews in your feeds. Anton Shilov is a contributing writer at Tom’s Hardware. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.