As artificial intelligence infiltrates the business world, demand for computing power is soaring.
Intel, the chipmaker whose silicon spurred the early computing revolution, is thought to be securing its hold on the changing industry with the acquisition of Israeli artificial intelligence (AI) chip start-up Habana Labs.
Should the billion dollar acquisition go through, it would be Intel’s third major AI start-up acquisition after Movidius and Nervana in 2016, and could secure the company’s position at the forefront of machine learning.
Habana has several innovative projects in the works. The startup is six months away from releasing an AI training processor known as Gaudi which is designed to process a trained neural network. And, with its recently released HL-1000 Goya chip, claims to have the first commercially available deep learning inference processor. This is said to have up to three times higher performance than Nvidia’s competing Tesla T4.
With the purchase of Habana, Intel would absorb the expertise behind these chips, and remove the threat of competition to its own chips developed with Movidius and Nervana.
But, the acquisition is also likely to attract criticism. Over the last few years, Intel has maintained an aggressive deal-making strategy, and several of the chipmaker’s expansion efforts have gone awry: the purchase of McAfee Security in 2010 was aimed at bringing security to the chip, which never transpired, and in the same year, Intel failed to catch up with the smartphone revolution with the ill-advised purchase of Infineon’s mobile phone business: Infineon Wireless Solutions.
These deals drew ire from stakeholders, who suggested Intel was relying too much on M&A to pivot into new markets.
With the acquisition of Habana, however, Intel would be doubling down on one of its core markets: datacenters. Along with personal PCs and smaller devices like smart cameras, datacenters are a key source of demand for AI-compatible chips.
Over the past few years, silicon from competitor AMD has grown more popular with datacenters, but by gaining a technological edge, Intel could wrestle back control over the global market, which despite headwinds from China is expected to grow at a CAGR of 6.5% to reach a valuation of $90 billion by 2022.
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