Microsoft is reportedly teaming up with chipmaker Advanced Micro Devices (AMD) to expand its foray into the development of artificial intelligence (AI) processors. This marks part of a multi-pronged strategy to secure more of the highly coveted components and offer an alternative to the dominant player in the market, Nvidia Corporation. Microsoft is providing support to bolster AMD's efforts, including engineering resources and is reportedly working with the chipmaker on a homegrown processor for AI workloads, called Athena. The project is part of a broader rush to augment AI processing power, which is in great demand after the explosion of AI-based services, including chatbots such as ChatGPT.
While Nvidia dominates the market for AI-capable chips called graphics processing units, or GPUs, several companies are looking to make inroads. As a top provider of cloud computing services and a driving force of AI use, Microsoft has been building up a silicon division over the past few years under former Intel executive Rani Borkar. The group now has a staff of almost 1,000 employees, several hundred of whom are working on the Athena project.
Microsoft's relationship with OpenAI, and its own slate of newly introduced AI services, are requiring computing power at a level beyond what the company expected when it ordered chips and set up data centers. OpenAI's ChatGPT service has drawn interest from businesses that want to use it as part of their own products or corporate applications, and Microsoft has introduced a chat-based version of Bing and new AI-enhanced Office tools. All of these AI programs run in Microsoft's Azure cloud and require the powerful processors that Nvidia provides.
According to Bloomberg, Microsoft's silicon division has spent around $2 billion on its chip efforts so far. Microsoft is also updating older products like GitHub's code-generating tool. The Athena project involves developing a graphics processing unit that can be used for training and running AI models. The product is already being tested internally, and it could be more widely available as soon as next year.
However, creating an alternative to Nvidia's lineup will be a challenging task. Nvidia offers a package of software and hardware that works together, including chips, a programming language, networking equipment, and servers, enabling customers to rapidly upgrade their capabilities. That's one of the reasons Nvidia has become so dominant in the market. But Microsoft isn't alone in trying to develop in-house AI processors. Amazon, another cloud rival, acquired Annapurna Labs in 2016 and has developed two different AI processors. Alphabet's Google also has a training chip of its own.
In conclusion, the collaboration between Microsoft and AMD in the development of AI processors could offer a viable alternative to Nvidia's dominance in the market. The project is part of a broader rush to augment AI processing power, which is in great demand following the explosion of AI-based services. While creating a viable alternative to Nvidia's lineup may be challenging, Microsoft is not alone in trying to develop in-house AI processors, and the industry is ripe for innovation and development.
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