Conclusion & End Remarks

We’ve been hearing about Arm in the server space for many years now, with many people claiming “it’s coming”; “it’ll be great”, only for the hype to fizzle out into relative disappointment once the performance of the chips was put under the microscope. Thankfully, this is not the case for the Graviton2: not only were Amazon and Arm able to deliver on all of their promises, but they've also hit it out of the park in terms of value against the incumbent x86 players.

The Graviton2 is the quintessential reference Neoverse N1 platform as envisioned by Arm, aiming for nothing less than disruption of the datacentre market and making Arm servers a competitive reality. The chip is not only  able to compete in terms of raw throughput thanks to its 64 physical cores in a single socket, but it also manages to showcase competitive single-thread performance, keeping in line with AMD and Intel systems in the market.

The Amazon chip isn’t perfect, we definitely would have wanted to see more L3 cache integrated into the mesh interconnect as the 32MB does seem quite mediocre for handling 64 cores, and the chip does suffer from this aspect in terms of its performance scaling in memory heavy workloads. Only Amazon knows if this is a real-world bottleneck for the chip and the kind of workloads that are typical in the cloud.

Performance wise, there’s a big empty outline of an elephant in the room that's been missing from our data today, and that’s AMD’s new EPYC2 Rome processors. AMD has showed it had been able to vastly scale performance and do away with a lot of the limitations presented by the first generation EPYC processors that we saw today. Even if we can somewhat estimate the performance that Rome would represent against the Graviton2, we don’t have any idea of what kind of pricing Amazon will be launching the new c5a type instances at.

In terms of value, the Graviton2 seemingly ends up with top grades and puts the competition to shame. This aspect not only will be due to the Graviton2’s performance and efficiency, but also due to the fact that suddenly Amazon is now vertically integrated for its EC2 hardware platforms. If you’re an EC2 customer today, and unless you’re tied to x86 for whatever reason, you’d be stupid not to switch over to Graviton2 instances once they become available, as the cost savings will be significant.

What does this mean for non-Amazon users? Well the Arm server has become a reality, and companies such as Ampere and their new Altra server chips are trying to quickly follow up with the same recipe as the Graviton2 and offer similar ready-made meals for the non-Amazons of the world. These chips however will have to compete with AMD’s Rome, and later in the year the new Milan, which won’t be easy. Meanwhile Intel doesn’t seem to be a likely competitor in the short term while they’re attempting to resolve their issues.

Long-term, things are looking bright for the Arm ecosystem. Arm themselves are aiming to maintain a yearly 20-25% compound annual growth rate for performance, and Ampere already stated they’re looking for yearly hardware refreshes. We don’t know Amazon’s plans, but I imagine it’ll be similar, if not skipping some generations. Around the 2022 timeframe we should see Matterhorn-based products, Arm’s new Very Large™ CPU microarchitecture which should again accelerate things dramatically. In a similar sense, the newly founded Nuvia has lofty goals for their entrance into the datacentre market, and they do have the design talent with a track record to possibly deliver, in a few years’ time.

The Graviton2 is a great product, and we’re looking forward to see more such successful designs from the Arm ecosystem.

Cost Analysis - An x86 Massacre
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  • notladca - Tuesday, March 10, 2020 - link

    I would love to know if the product line has split within Annapurna. In other words whether Graviton2 has, like previous Annapurna SoCs, some interesting support around storage and networking for use in future Nitro. It's possible Amazon has some behind the scenes work going on with CCIX for future machines. For example integrating their Inferentia chip more closely with the SoC.

    Given the core count, it'd also be interesting to compare ML inference acceleration via fp16 and int8 dot product instructions per core vs use of GPU or Inferentia.
  • coder543 - Tuesday, March 10, 2020 - link

    One small bit of feedback: with that CPU topology chart, the coloration seems a little off. A difference of +/- 1 yields very different shades of red and orange, but the same difference on the green side of the spectrum yields no discernible difference in color? Personally, I think all of the 200 +/- 5 values in the first topology chart should be an almost uniform sea of orange/red. The important thing is the 150 difference in latency, not the +/- 1 latency, and the noise in the colors distracts the reader from the primary distinction. A lower signal to noise ratio.

    Also: what is the unit? nanoseconds? microseconds? milliseconds? I can’t figure it out, and it’s not labeled as far as I can tell.
  • Andrei Frumusanu - Tuesday, March 10, 2020 - link

    Nanoseconds, I'll add a remark.
  • sing_electric - Tuesday, March 10, 2020 - link

    My tin hat is telling me to be suspicious of Amazon's pricing here. When shopping for cloud computing, perf/$ becomes VERY alluring, but I have to wonder if Amazon is willing to let its Gravitron servers be a "loss leader," artificially lowering prices to get market share until Arm on server is well-established - before then raising prices to something closer to a economically sustainable number.
  • Andrei Frumusanu - Tuesday, March 10, 2020 - link

    Vertical integration is powerful. Amazon can share profits and margins division wide, not having to pay overhead to AMD/Intel.
  • sing_electric - Tuesday, March 10, 2020 - link

    True, but then Amazon has to pay for the ARM license and 100% of the development/production costs. I would be very surprised if they managed to *make money* on the 1st couple Graviton generations (especially if you factor in having to buy Annapurna), since you'd need to say "of the $X generated by Graviton metal, $Y would have been spent on EC2 anyways, meaning $Z is our actual gain," and that's... probably too much to ask at this stage.
  • rahvin - Tuesday, March 10, 2020 - link

    The costs you mention are nothing compared to what they pay right now with Intel or AMD with they 50% margins on top of the actual cost. IMO this initiative was born out of Intel's price increases from 2010 to now. By vertically integrating they have full control over the price structure and they have very good data on what kind of workloads are running so they can tailor the design.

    IMO it was just a question of time until Amazon tried to vertically integrate this like they've done with shipping and lots of other stuff. Bezos is following the Robber Barron growth model.
  • dotjaz - Wednesday, March 11, 2020 - link

    Huh? AMD has a gross margin of 40%, true. But keep in mind AWS has a operating margin of 30%, that mean AWS has a even higher gross margin than AMD, comparable to AMD's server department.
    Do you know what that means? For $1 of expenditure in to chip manufacturing, AWS expects to earn as much as AMD does. And since AWS don't have the volume as far as chip goes, their gross margin for chip investment will be lower, therefore not worth the investment if the decision is purely financial.

    But yes, the other point stands, AWS have better control of costing (with more leverage as well) and performance.
  • Wilco1 - Wednesday, March 11, 2020 - link

    For every $1 worth of silicon you could pay AMD $1.50, pay Intel $2 or pay TSMC $1 plus $0.20 internal development costs. Which works out best you think?
  • extide - Friday, March 13, 2020 - link

    It's not that simple. AMD and Intel can spread those development costs over vastly more processors. I mean we'll never know how it truly breaks down -- but I'd imagine Amazon has figure this all out and this will be pretty profitable for them.

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