NVIDIA Creates New Subsidiary Focused on Design-On-Demand Chip Manufacturing for AI, Console, and Automotive Industries, Diversifying Operational Fronts
Instead of colliding with the arrival of greater competition in the artificial intelligence sector and maintain hegemony in the segment, NVIDIA is choosing to diversify its operations. Recently, the company founded a new subsidiary aimed at creating chips on demand for several markets beyond artificial intelligence, while also investing in the console, automotive and telecommunications sectors.
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So far the company has focused almost exclusively on products for HPC server infrastructure, cloud computing and generative artificial intelligence. Apparently, the new company will make use of the skills of NVIDIA in artificial intelligence to provide customized solutions for more fragmented niches in the consumer market, and more details will likely be revealed during Nvidia GTC in March.
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Diversify operations
The biggest problem of dominate a single segment is that, despite the rapid growth in profitability, the decline in revenue will also be very sharp if it turns into a bubble. For this reason, the initial strategy of Intel AND OMG for the AI ​​market has already involved investments in large-scale products for various sectors, facilitating the adoption of its products and minimizing risks in the medium and long term.
However, at least some of this new competition is also targeting the heavy infrastructure sector, which currently consists largely of accelerators. NVIDIA H100 and GH200. In this way, instead of trying to maintain its dominant position in the market, the company also seeks to provide products at scale, to gain space – and contracts – as these new sectors also modernize.
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According to Reuters, NVIDIA has already started negotiations with Amazon, Objective, Microsoft, Google and OpenAI to produce custom chips that these companies can integrate into their proprietary AI solutions. Furthermore, NVIDIA is too development of ARM processors for PCs and face Intel and AMD, which are currently the two relevant players in the sector.
At the end of 2023 NVIDIA also announced a series of investments and partnerships in the autonomous vehicle and telecommunications sectors, and recent rumors place the company still in the race against Intel and AMD for provide APU for new Xbox. With more and more companies looking own chips for your servicesAnalysts suggest that the custom chip industry is expected to grow to $30 billion next year, justifying NVIDIA’s decision to open a subsidiary to serve new potential customers.
Source: Reuters
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Rose James is a Gossipify movie and series reviewer known for her in-depth analysis and unique perspective on the latest releases. With a background in film studies, she provides engaging and informative reviews, and keeps readers up to date with industry trends and emerging talents.
