(Reuters) – Alphabet-owned Google’s executives have discussed dropping Broadcom as a supplier of artificial intelligence (AI) chips as early as 2027, The Information reported on Thursday.
If that happens, Google will design the chips – known as tensor processing units – in-house, the report said, adding that executives set a goal earlier this year to ditch Broadcom following a standoff between the companies over the price Broadcom was charging for the chips.
Google also plans to launch an improved networking chip, internally code-named Granite Redux, with chipmaker Marvell Technology by next year, The Information said.
Google, Broadcom and Marvell didn’t immediately respond to a Reuters request for comment.
Broadcom shares fell 3.7% in premarket trading.
According to a report by The Information on Thursday, executives at Alphabet-owned Google have been discussing the possibility of dropping Broadcom as a supplier of artificial intelligence (AI) chips, as early as 2027. If this decision is made, Google would take on the responsibility of designing the chips, known as tensor processing units, in-house. The report indicates that tensions arose between Google and Broadcom earlier this year due to a dispute over the price of the chips. Executives at Google have reportedly set a goal to find an alternative supplier and reduce dependency on Broadcom.
The report also reveals that Google is planning to launch a new and improved networking chip, currently referred to as Granite Redux, next year. This chip will be designed in collaboration with chipmaker Marvell Technology. There has been no official response from Google, Broadcom, or Marvell regarding these reports.
The news of a potential supplier change has affected Broadcom’s stocks, which fell by 3.7% in premarket trading. This development highlights the growing importance of AI chips in the tech industry and the desire for companies like Google to have more control over their supply chains.
As the demand for AI chips continues to rise, companies are looking for ways to secure reliable and cost-effective suppliers. The decision by Google to potentially switch suppliers reflects their commitment to maintaining control over the production and cost of these crucial components.
It remains to be seen whether Google will move forward with dropping Broadcom as a supplier, but the discussions highlight the company’s dedication to advancing its AI capabilities and reducing reliance on external partners.
Both Google and Broadcom have been significant players in the AI chip market, and any change in their relationship would have a substantial impact on the industry. As technology continues to advance, it is essential for companies to stay adaptable and ensure they have the necessary resources to innovate and deliver cutting-edge solutions.
As this story develops, industry experts and stakeholders will be closely monitoring the progress and any potential announcements from Google, Broadcom, and Marvell regarding their future partnership and chip supply arrangements.
Contacted by Reuters, none of the companies involved – Google, Broadcom, or Marvell – provided an immediate response or comment on the news.
The market will be eagerly awaiting further developments regarding this potential chip supplier change and watching closely for any official announcements from the involved parties.
Source: Reuters
Credit: The Star : Tech Feed
