Amazon plans new AI chip to reduce reliance on Nvidia

Amazon is preparing to launch its latest artificial intelligence chip in an effort to reap returns from its massive semiconductor investments while reducing its reliance on market leader Nvidia. Executives at Amazon’s cloud computing division are investing heavily in custom chips to make its many data centers more efficient, ultimately reducing its own operating costs as well as costs for Amazon Web Services customers. The project is being led by Annapurna Labs, an Austin-based chip startup that Amazon acquired in 2015 for $350 million. Annapurna’s latest work is expected to be unveiled next month when Amazon announces the broad availability of “Trainium 2.” Trainium 2 is part of a family of AI chips designed to train the largest models. Trainium 2 is already being tested at Anthropic (a rival to OpenAI that has received $4 billion in Amazon backing), Databricks, Deutsche Telekom, Japan’s Ricoh, and Stockmark. AWS and Annapurna aim to challenge the market dominance of Nvidia, which has become one of the world’s most valuable companies on the strength of its dominance of the AI ​​processor market.