What you need to know
- OpenAI reportedly offered Intel a 15% stake for $1 billion, but the chip brand turned down the offer.
- Intel didn’t think AI models would penetrate the market and didn’t want to develop chips for OpenAI at cost.
- Intel is now worth below $100 billion and has recently experienced massive layoffs to save on costs.
As a tech enthusiast who has witnessed the rise and fall of many tech giants, it’s always fascinating to look back at missed opportunities. The story of Intel’s potential partnership with OpenAI is one such instance that left me shaking my head in disbelief.
Were you aware that Intel had a chance to collaborate with OpenAI, using their technology to enhance its own products and services, prior to Microsoft’s investment? According to Reuters, high-ranking officials from Intel and OpenAI were reportedly in discussions about a potential partnership that could have been advantageous for both parties.
2017 saw OpenAI allegedly proposing a deal to Intel where they would receive a 15% share for an investment of $1 billion. The intention behind this was to get Intel to produce chips that could support OpenAI’s advancements, thus reducing their heavy reliance and dependence on NVIDIA for GPUs. Similarly, Microsoft and OpenAI are now working towards a similar objective with the project named Stargate, and have pledged $100 billion as part of their self-confidence in this venture.
Nevertheless, the agreement failed to materialize as Bob Swan, ex-CEO of Intel, held skepticism towards the AI hype, viewing it as not significantly impactful in the near future. Additionally, Intel’s data center opted against producing and innovating goods for OpenAI due to concerns over cost.
NVIDIA is a true manifestation of Intel’s wildest dreams
Toward the start of this month, Intel’s CEO, Pat Gelsinger, disclosed a significant decision: the company plans to reduce its workforce by approximately 15,000 employees in an extraordinary measure aimed at achieving $10 billion in savings over the next few years up to 2025. Gelsinger also acknowledged that this news might be hard to hear, stating, “This is tough for me to share, and I understand it will be even harder for you to read.” However, one may wonder what led Intel to such a situation?
In the unfolding age of artificial intelligence, it appears that Intel, from my perspective, seems to grapple with identifying its niche and establishing a foothold in emerging sectors such as server technology, graphics processing units (GPUs), and AI advancements. Quite intriguingly, NVIDIA, on the other hand, has demonstrated remarkable growth in this burgeoning field.
It’s worth noting that at present, NVIDIA leads the market as the most financially successful semiconductor chip manufacturer, surpassing competitors like Samsung and Intel. The reason behind this success is largely due to the high demand for AI chips from major tech companies and NVIDIA’s commitment to investing in this technology.
Come June, NVIDIA managed to outshine both Microsoft and Apple, claiming the title of the world’s most valuable company with a whopping market capitalization of $3.335 trillion. In stark contrast, Intel now finds itself struggling, with a market value less than $100 billion, largely due to its lack of success in the red-hot AI chip market.
Intel is said to have endeavored to challenge both NVIDIA and AMD in the AI chip market, yet apparently fell short in its efforts, as per Dylan Patel, founder of SemiAnalysis.
“Intel failed in AI because they didn’t present a cohesive product strategy to their customers.”
It’s uncertain if Intel will match its competitors in the near future. Meanwhile, a recent study suggests that the excitement around AI could be waning, as approximately 30% of ongoing AI projects may be abandoned following the proof-of-concept stage by 2025.
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2024-08-08 13:39