Intel and Softbank discussed an AI accelerator project to compete with Nvidia, but did not agree

As it turns out, among Intel’s potential partners there were now and then enterprising companies ready to entrust it with the production of advanced accelerators for artificial intelligence systems. In addition to missing the opportunity to collaborate with OpenAI in this area, Intel also did not become closer to the Japanese corporation SoftBank, which owns the British developer of processor architectures Arm.

Image Source: Intel

The Financial Times found that over the past few months, SoftBank had been trying to reach an agreement with Intel to release specialized AI chips developed by people from the company it bought, Graphcore. In this situation, Intel had to act as a contract chip manufacturer. After negotiations with Intel led to an unsatisfactory result, SoftBank decided to focus on negotiations with TSMC.

If cooperation with Intel had taken place, as the sources continue, SoftBank would have been able to qualify for part of the American subsidies under the so-called “Chip Act”, since the production of the relevant components for its needs would have been carried out in the United States. According to the source, SoftBank’s negotiations with Intel fell apart due to the fault of the latter party. At least that’s what the first of them insists on. The customer was not satisfied with Intel’s capabilities in terms of the speed of chip production and the volume of their production. However, given the high workload of TSMC with such orders, Intel is still not written off from SoftBank’s point of view.

SoftBank management hoped to attract potential buyers of similar accelerators created using Graphcore developments to finance this initiative. SoftBank’s entry into this market segment could harm the relationship between Arm and Nvidia, since the latter is a major client of this British holding. However, now the market for AI components is a tasty morsel for many companies, and the potential benefits could compensate for such a risk. SoftBank is not losing hope of creating prototypes of its own accelerator in the coming months, but it is difficult to count on TSMC’s capabilities in this area due to the high workload on this Taiwanese company. Intel would be useful to SoftBank in this case with its competencies in chip development, and not just as a contract manufacturer. The project, the financing of which would require many tens of billions of US dollars, was planned to be implemented with the participation of Arab investors. It recently became known that Intel got rid of Arm shares purchased last year in order to maximally mobilize its own financial resources.