Why Tesla, Apple, Google and Fb are designing their very own chips

Google CEO Sundar Pichai talks in regards to the firm’s third-generation synthetic intelligence chips.

Supply: YouTube screenshot

Not content material with counting on normal chips which might be in excessive demand, a few of the world’s greatest tech corporations are creating their very own semiconductors.

Apple, Amazon, Fb, Tesla and Baidu are all shunning established chip corporations and bringing sure points of chip growth in-house, in response to firm bulletins and media stories.

“More and more, these firms need custom-made chips becoming their functions’ particular necessities somewhat than use the identical generic chips as their rivals,” Syed Alam, world semiconductor lead at Accenture, advised CNBC.

“This offers them extra management over the mixing of software program and {hardware} whereas differentiating them from their competitors,” Alam added.

Russ Shaw, a former non-executive director at U.Okay.-based Dialog Semiconductor, advised CNBC that custom-designed chips can carry out higher and work out cheaper.

“These particularly designed chips can assist to scale back power consumption for gadgets and merchandise from the precise tech firm, whether or not it pertains to smartphones or cloud companies,” Shaw stated.

The continuing world chip scarcity is another excuse why huge tech corporations are considering twice about the place they get their chips from, Glenn O’Donnell, analysis director at analyst agency Forrester, advised CNBC. “The pandemic threw a giant wrench in these provide chains, which accelerated efforts to do their very own chips.”

“Many already felt restricted of their innovation tempo being locked into chipmaker timelines,” O’Donnell stated.

A.I. chips and extra

Some of the tech giants have chosen to keep certain semiconductor projects under wraps.

Google is reportedly edging closer to rolling out its own central processing units, or CPUs, for its Chromebook laptops. The search giant plans to use its CPUs in Chromebooks and tablets that run on the company’s Chrome operating system from around 2023, according to a report from Nikkei Asia on Sep. 1. Google did not immediately respond to a CNBC request for comment.

Amazon, which operates the world’s largest cloud service, is developing its own networking chip to power hardware switches that move data around networks. If it works, it would reduce Amazon’s reliance on Broadcom. Amazon, which already designs a number of other chips, did not immediately respond to a CNBC request for comment.

Facebook’s chief AI scientist told Bloomberg in 2019 that the company is working on a new class of semiconductor that would work “very differently” than most of the existing designs. Facebook did not immediately respond to a CNBC request for comment.

Designing but not manufacturing

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