Generative AI is skyrocketing at an incredible rate, and one of the prominent players in this space is OpenAI, the brains behind ChatGPT. Like many other startups in the field, this Microsoft-backed company is spending millions to improve its AI capabilities.
While chipmakers such as AMD and NVIDIA are rolling out processors specifically designed for AI tasks, OpenAI believes it can develop custom AI chips.
OpenAI collaborates with Broadcom and TSMC for its first chip.
A fresh report shows that OpenAI has updated its hardware strategy. The company is working with Broadcom and TSMC to develop its first in-house chip designed specifically to support its AI systems. In addition, OpenAI is incorporating AMD chips with Nvidia to keep up with its growing infrastructure needs. According to unnamed sources, OpenAI has explored various options to diversify its chip supply and reduce costs. At one point, the company even considered getting funding to manufacture everything in-house and set up a network of factories, called “foundries,” to manufacture the chips.
However, the company seems to have put its ambitious foundry plans on hold for now, mainly due to the costs and time required to set up the network. Instead, it will focus on its in-house chip design efforts. As one of the largest chip buyers, OpenAI’s choice to source from a variety of chipmakers while developing custom chips could have broader implications for the tech sector.
OpenAI, a key player in commercializing generative AI that produces human-like responses, requires significant computing power to train and operate its systems. As one of the top buyers of Nvidia’s graphics processing units (GPUs), OpenAI uses these AI chips for both training models – where the AI learns from data – and inference, which is based on new information. AI is applied to make predictions or decisions.
According to sources, OpenAI has been collaborating with Broadcom for several months to develop its first AI chip focused on AI. While training chips are currently in high demand, analysts expect the need for inference chips to overtake them as more AI applications emerge. Through Broadcom, OpenAI has reportedly secured manufacturing capacity with Taiwan Semiconductor Manufacturing Company (TSMC) to produce its first custom-designed chip by 2026, though that timeline could change. is
ChatGPT’s capabilities have greatly improved since its inception. | Video credit – OpenAI
Nvidia’s GPUs currently dominate the market with over 80% share. However, rising costs and supply shortages have prompted major customers such as Microsoft, Meta, and now OpenAI to look for both internal and external alternatives. I think this change can be a wise strategy, as relying on a single supplier is not always the best approach. In other OpenAI-related news, the company It is said that there will be a loss of $14 billion by 2026.. Despite its significant growth and increasing demand for AI models, the company is expected to remain unprofitable until at least 2029.