Google Plans to Drop Broadcom as its AI Chip Supplier, Pursues In-House Development
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Google plans to end its association with Broadcom, and aims to manufacture its AI chips in-house by 2027.
This move follows a pricing dispute between the two companies and highlights Google’s ambition to take greater control of its hardware ecosystem, particularly in AI infrastructure.
Alphabet-owned tech giant Google plans to end its partnership with AI chip supplier Broadcom, and aims to produce its chips in-house by 2027.
The decision comes after a recent standoff between the two companies over chip pricing, which led Google executives to set a goal of reducing reliance on external suppliers. The potential shift has sent Broadcom’s shares tumbling by 5% in premarket trading, according to a report by The Information.
Broadcom currently supplies Google with tensor processing units (TPUs), a pivotal component in AI infrastructure. The partnership previously underscored Google’s ambition to assert greater control and foster innovation within its hardware ecosystem.
Google is actively working on replacing Broadcom with chipmaker Marvell Technology to develop an advanced chip internally known as “Granite Redux.” This move is part of Google’s broader efforts to enhance its generative AI capabilities, responding to competitors such as Microsoft.
Designing AI chips in-house demonstrates Google’s commitment to AI innovation and a strategic shift toward securing a more self-reliant and cost-effective supply chain for its hardware requirements.
Broadcom CEO Hock Tan recently stated that generative AI could contribute significantly to the company’s semiconductor revenue. This highlights the importance of Google’s potential transition in AI chip manufacturing.
Google is going all-in on the future of generative AI. In August, Google announced a $13 billion investment in expanding its data center capacity. This investment aims to strengthen Alphabet’s AI projects by improving GPUs, custom TPUs, and growing data center capabilities.
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