Nvidia mulling plans to buy VIA as Graphics and CPU merge

The semiconductor market could suddenly become agitated fairly soon as Digitimes reveals that Nvidia is looking to acquire VIA Technologies, shortly after acquiring Ageia, a company which launched the concept of Physics Processing Unit.

According to motherboard manufacturers Digitimes interviewed, Nvidia is currently baulking at the high price Formosa Plastic Groups, which owns VIA, is asking.

Digitimes also reveals that Nvidia is said to be particularly interested in VIA's processor division which holds the key to Nvidia's official entry in the world of x86-compatible processors.

VIA can manufacture x86 processors as it posseses a proper license to do so since it acquired Centaur and Cyrix although VIA's latest processors have been anything but exciting recently when it comes to the performance.

For both Nvidia and VIA though, it could well be a matter of life or death; AMD and Intel have been very ambitious as the competition between both rivals spill over to the graphics market; Intel has already announced that it will launch its own graphics solution, called Larrabee, fairly soon, which would put Nvidia under immense pressure as it finds itself having to work with two competitors to sell its gear.

As for VIA, the rise of Nvidia, AMD and Intel as chipset manufacturers means that its core business has plundered; revenues are down significantly since the heydays of 2001; its microprocessor and graphics segments have dwindled significantly and are nowhere near the rest of the market as far as performance is concerned.

Nvidia has the money and VIA an exit strategy; it is therefore not a matter of whether, it is more a matter of when.