Not wanting Nvidia to dominate it, Microsoft is assisting AMD in developing artificial intelligence chips

On May 5, according to people familiar with the matter, Microsoft is cooperating with chip manufacturer AMD to help the latter expand into the field of artificial intelligence chips. This is part of Microsoft's multi-pronged strategy to acquire more of its popular chips.

According to people familiar with the matter, the two companies are joining forces to provide an alternative to Nvidia. Nvidia dominates the market for graphics processing unit processors (GPUs), which are chips used to perform artificial intelligence calculations. Microsoft is funding AMD's efforts to develop an artificial intelligence processor code-named Athena.

The two companies are joining forces to offer alternatives to Nvidia, according to people familiar with the matter. Nvidia dominates the market for graphics processing units (GPUs), chips that can be used to perform artificial intelligence tasks. Microsoft is funding AMD's efforts to develop an artificial intelligence processor code-named Athena.

With the explosive growth of chatbots such as ChatGPT and other services based on artificial intelligence technology, the demand for artificial intelligence chips from various enterprises has also increased sharply, which has prompted Microsoft and AMD to cooperate to enhance artificial intelligence. Intelligent processing capabilities. Microsoft is a top provider of cloud computing services and a driving force in artificial intelligence applications. The company has invested more than $10 billion in ChatGPT maker OpenAI and vowed to add the features to its entire software lineup.

The partnership also reflects Microsoft's deepening involvement in the chip industry, which it has spent the past few years building under the leadership of former Intel executive Rani Borkar. The chip department currently has nearly 1,000 employees. Last month, some media reported on Microsoft’s development of the Athena artificial intelligence chip.

According to a person familiar with the matter, hundreds of employees are currently involved in Project Athena, and Microsoft has invested approximately US$2 billion in chip research and development. But this does not mean that it will break with Nvidia, because Nvidia chips are the main force in training and running artificial intelligence systems, and Microsoft still intends to maintain close cooperation with Nvidia. Additionally, Microsoft is seeking to acquire more Nvidia processors, underscoring the chip shortage facing Microsoft and other companies.

Microsoft’s partnership with OpenAI and the company’s new slate of artificial intelligence services have created more computing power than they anticipated when they ordered chips and built data centers. OpenAI's ChatGPT service has attracted interest from enterprises looking to integrate it into their own products or enterprise applications. Microsoft also launched a new chat-based Bing search engine, as well as Office tools enhanced by artificial intelligence.

At the same time, Microsoft is also updating products that were released earlier, such as GitHub's code generation tool. All of these artificial intelligence programs run on Microsoft's Azure cloud and require support from Nvidia's expensive and powerful processors.

This area is also a key priority for AMD, with CEO Su Zifeng saying on a recent earnings call: "We are very excited about the opportunities we face in artificial intelligence, which is where we No. 1 strategic priority. We are in the early stages of the era of artificial intelligence computing, which is adopting and growing faster than any other technology in modern history.” Su Zifeng also said that AMD has the opportunity to provide Its largest customers produce some custom chips for use in their artificial intelligence data centers.

Microsoft's Borkar team has been developing chips for servers and Surface computers, and now they are prioritizing Project Athena. The project is developing a graphics processing unit (GPU) for training and running artificial intelligence models. It is reported that this product is under internal testing and is expected to be officially launched next year.

Sources also said that even if the Athena project can be completed as scheduled, the first version of the product is just a new starting point. Because it often takes years to make good chips, Nvidia already has a big advantage. In fact, Nvidia is the chip supplier of choice for many providers of generative artificial intelligence (AIGC) tools, including Amazon's AWS and Google Cloud. Tesla CEO Elon Musk has also purchased thousands of Nvidia processors to power his fledgling artificial intelligence company.

Developing products to replace Nvidia chips will be a challenging task. NVIDIA provides a set of software and hardware supporting services, including chips, programming languages, network equipment and servers, allowing customers to quickly upgrade their capabilities. This is one of the reasons why Nvidia dominates. However, Microsoft is not the only company trying to develop an in-house AI processor. Its cloud computing rival Amazon acquired Annapurna Labs in 2016 and developed two different AI processors. Google also has its own training chip.

After the news broke that Microsoft and AMD announced their cooperation, AMD's stock price rose more than 6.5%, and Microsoft's stock price rose about 1%. Representatives for both companies declined to comment on the partnership. Meanwhile, Nvidia shares fell 1.9%.

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