- The US currently leads in AI accelerator chip innovation, closely followed by China and South Korea.
- Among Chinese firms, Huawei leads with its Ascend series of AI accelerator chips, followed by Alibaba, Baidu, and others.
- Industry stakeholders should closely monitor the landscape for potential mergers and acquisition opportunities in the near future.
Many AI accelerator chip startups are challenging and giving a tough fight to incumbents as genAI applications are projected as a transformative technology with a long-term impact.
Though the market is dominated by big players, 17 new companies entered the market and filed new patents in the past year alone.
Notably, innovation is shifting towards efficiently handling AI processes on edge devices, with 24% of all patents mentioning edge computing use cases, followed by autonomous driving and other solutions.
“The rise in generative AI adoption has led to intense competition for superior AI accelerator chips. While the market is dominated by large players like Google, Nvidia, and Intel, there are clear signs of increasing disruption by startups in this space,” Sourabh Nyalkalkar, Practice Head of Innovation Products at GlobalData, said.
Neural networks
Tensor processing units (TPUs) are specialised hardware designed to accelerate the processing of AI and machine learning models. While originally created by Google for its TensorFlow framework, TPUs now represent a broader class of AI accelerator chips used for running neural networks and other machine learning models in complex operations ranging from autonomous driving to drug discovery.
Additionally, companies like Tesla and Apple are also building their in-house capabilities, as evident from the innovation leadership map in Technology Foresights.
Meta Platforms, which is advancing its large language model Llama for generative AI solutions, introduced its own AI accelerator chip last month.
Meanwhile, Samsung secured a significant $750 million contract from Naver Corp to supply edge AI accelerator chips. Both companies are recognised among the leaders in AI accelerator chips by Technology Foresights.
Growth opportunity
The US currently leads in AI accelerator chip innovation, closely followed by China and South Korea. Among Chinese firms, Huawei leads with its Ascend series of AI accelerator chips, followed by Alibaba, Baidu, and others.
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In recent years, 20 per cent of all patents in AI accelerator chip technology were filed by startups, signaling growing disruption in the market. Hailo, the Israeli startup specialising in AI accelerator chips for edge devices, recently raised $120 million.
Cortica, which leads in developing AI processors for autonomous driving applications, and Femtosense, known for creating specialised AI chips for small, energy-efficient electronic devices, are prominent among startups in innovation strength.
OpenAI, the leading generative AI company, is reportedly exploring potential acquisition targets to reduce its reliance on Nvidia. Intel and AMD have strengthened their innovation portfolios through the acquisitions of Habana Labs in 2019 and Nod.ai in 2023, respectively.
With nearly $4 billion raised by specialised AI chip startups between 2021 and 2023, and substantial scale-up efforts by large players to meet growing demands, Nyalkalkar said the growth opportunity for AI accelerator chips appears robust.
“With over 90 companies developing innovations in this space, industry stakeholders should closely monitor the landscape for potential mergers and acquisition opportunities in the near future.”