Tech giants are not just relying on standard chips that are in high demand, they are developing their own semiconductors.
Apple, Amazon, Facebook, Tesla and Baidu all eschew existing chip companies and bring certain aspects of chip development internally.
These companies want chips that are custom-made to suit the specific requirements of their applications rather than using the same generic chips as their competitors.
This gives them more control over software and hardware integration while setting them apart from their competitors. And specially designed chips can work better and come at a cheaper price.
It can also help reduce the power consumption of devices and products from the specific technology company, whether it is related to smartphones or cloud services.
The persistent shortage of global chips is another reason why major tech companies are thinking about where to get their chips.
The pandemic has dealt a major blow to supply chains, accelerating tech giants’ efforts to make special chips.
At present, barely a month goes by without a major technology company announcing a new chip project.
Perhaps the most notable example came in November 2020 when Apple announced that it was moving away from Intel’s x86 architecture to make its own M1 processor, which is now found in new iMacs and iPads.
Tesla recently announced that it is building a Dojo chip to train AI networks in data centers.
In 2019, the automaker began producing cars with custom AI chips that help embedded software make decisions in response to what’s happening on the road.
Last month, Baidu launched an artificial intelligence chip designed to help devices process massive amounts of data and boost computing power.
Baidu said the Kunlun 2 chip could be used in areas such as self-driving and that it had gone into mass production.
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Some tech giants have chosen to keep some semiconductor projects under wraps. Google is said to be close to launching its own processor for Chromebook laptops.
The search giant plans to use its processors in Chromebooks and tablets running Chrome OS around 2023.
Amazon, which operates the world’s largest cloud service, is developing its own network chip to power Network switch devices that transmit data across networks.
If successful, this would reduce Amazon’s dependence on Broadcom. Amazon is developing a number of other chips.
Facebook’s chief AI scientist said in 2019 that the company is working on a new class of semiconductors that works very differently than most current designs.
And none of the tech giants at this point is looking to do all the chip development themselves. It’s about chip design and performance, not manufacturing and foundries, which is very expensive.
It costs about $10 billion to set up an advanced chip factory and takes several years. Even Google and Apple are conservative about the construction. And you go to TSMC or even Intel to build the chips.
Silicon Valley suffers from a shortage of people with the skills required to design high-quality processors.
Additionally, Silicon Valley has focused so much on software over the past few decades that hardware engineering has been considered part of an anachronism.
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