Nvidia has been kicking quite a lot of mud on Intel. Recently, it started with Nvidia claiming the GPU is more important than the CPU, then it was calling Larabee a powerpoint slide and then claiming that Intel is a monopoly that doesn't want anyone else in the market. But in reality, NVidia dreams to be at Intel's position and its been proved once again with NVidia buying Utah-based ray-tracing company RayScale.
If you've been following the discussion, or you read the above links, then you'll realize how pissed off the Nvidia CEO Jen-Hsun Huang has got with Intel. The reason for this anger is that Intel has been researching on architectures that are supposed to replace GPU (graphic cards) from computers. If Intel succeeds, it means Nvidia are without a market. Intel calls these next-gen processors that will be able to process graphics along with normal CPU operations as Larabee. AMD is also working on something similar called Fusion. NVidia on the other than doesn't have much to bet on. Although CUDA is starting to make GPUs do the work of CPUs, its way more steeper upgrade curve. Imagine porting all your normal Apps to CUDA vs Optimizing your games for a CPU that can show graphics.
With all that trouble knocking on Nvidia's doors, obviously you can't blame Jen-Hsun Huang for his anger. But today's buy of RayScale could point to what NVidia could do in the future. Intel has been pursuing a lot of research on Ray-tracing as a replacement for the vector processing that we see on today's graphic cards. Ray-tracing can be done on CPUs or Larabee/Fusion and could render images on screen, with more realistic lighting and shadow effects. Currently it takes a lot of processing, but it isn't too far from becoming mainstream once we have optimized processors. NVidia may be preparing for such a product and RayScale could be its software partner to move in that direction.
Nvidia also does not have the great fabs that Intel owns. Intel's strength is its production and NVidia really can't manufacture its own designs. Thus, if Nvidia even manages to create a killer GPU+CPU, how can it create enough of these for the entire world?? AMD on the other hand with their ATI buy can switch anywhere between a CPU+GPU or GPU+CPU... But haven't you heard: If you've got one leg in one boat and the other leg in another boat, you end up catching your groin!!