NVIDIA EULA Update Forbids GeForce GPUs In Data Centers To Protect Fat Tesla Margins

NVIDIA recently updated the End-User Licensing Agreement (EULA) for its software, and some customers are fuming over the change. The "disturbance in the force" comes from an update in language in the EULA, which adds, "No Datacenter Deployment. The SOFTWARE is not licensed for datacenter deployment, except that blockchain processing in a datacenter is permitted."

That language was specifically inserted to prevent customers from using GeForce and TITAN-based graphics cards in commercial data centers. While GeForce and TITAN GPUs are often built from the similar architecture to NVIDIA’s data center-oriented Tesla GPU accelerators, they were not designed for use in such environments. However, it's understandable that NVIDIA's customers would like to cut a few corners and save a huge chunk of cash by going with far cheaper alternatives.

titan v angle 2

For example, a GeForce GTX 1080 Ti is priced at just over $700 on Amazon, the TITAN Xp is priced at $1,200, while the new TITAN V is priced is available for $2,999 direct from NVIDIA. All are expensive graphics cards -- especially the TITAN V -- but their costs pale in comparison to NVIDIA's current top dog Tesla V100, which is priced from $8,000.

But for NVIDIA, the company is looking to preserve hefty profit margins that come with Tesla GPUs in the data center arena. The EULA update applies to the use of GeForce and TITAN products for non-personal data center use. This would apply to commercial use of these GPUs for increasingly popular fields like artificial intelligence and deep learning. Interestingly, NVIDIA doesn't seem to concerned about these "inferior" GPUs being used for large-scale cryptocurrency mining operations (since it isn't often cost-effective to use higher-end GeForce and TITAN products for mining).

Some took to reddit to express their frustrations with NVIDIA's EULA update, some using rather colorful language. "NVIDIA, after doing some exploration and creating a bunch of cards, has now switched to exploitation mode. Basic strategy," wrote visarga. Some, however, think that NVIDIA has a more sinister strategy in place.

tesla v100 board
NVIDIA Tesla V100

"The biggest red flag here is not that they forbid you to use their software in data centers," wrote AlvinQ. "The biggest red flag is that they presume to dictate what purpose you are allowed to use the software for. Mining? That‘s still a competitive market, you can do that. ML? That‘s our monopoly, so we force you to pay more."

For its part, NVIDIA says that it updated the EULA to prevent "potential misuse" of GeForce and TITAN products that were not designed for demanding, mission-critical environments. "GeForce and TITAN GPUs were never designed for data center deployments with the complex hardware, software, and thermal requirements for 24x7 operation, where there are often multi-stack racks," said NVIDIA in a statement to CNBC.

"NVIDIA addresses the unique mechanical, physical, management, functional, reliability, and availability needs of servers with our Tesla products, which include a three-year warranty covering data center workloads, NVIDIA enterprise support, guaranteed continuity of supply and extended SKU life expectancy for data center components."

NVIDIA goes on to indicate that it will work on a "case-by-case basis" to help resolve any issues with customers that may be in current violation of its EULA, and that its new rules do not affect non-commercial and research use of GeForce and TITAN GPUs.