Nvidia gears up to protect its AI chip dominance with custom solutions for cloud companies

Nvidia is setting up a new business unit to develop custom AI chips for cloud computing companies and other customers. This was reported by Reuters, citing nine (!) sources. The company wants to grab a share of the growing market for custom AI chips while protecting itself from competitors developing alternatives to its products. Currently, Nvidia controls about 80 percent of the market for high-end AI chips and counts OpenAI, Microsoft, Alphabet and Meta Platforms among its customers. However, these tech giants are developing their own chips for specific needs. OpenAI in particular is reportedly planning a major chip initiative. It appears that Nvidia is now launching a counteroffensive. According to 650 Group researcher Alan Weckel, the market for custom AI chips in data centers will grow to $20 billion by 2025.