Semiconductor industry and market
What is it called when large cloud providers and the like design their own chips specialized for AI processing and other tasks for their data centers and have them made by foundries?
- ASecond sourcing
- BThe silicon cycle
- CCustom silicon (in-house designed chips)
Show answer and explanation
Answer: C. Custom silicon (in-house designed chips)
Companies running large data centers increasingly design (alone or with design partners) AI accelerators, CPUs and other chips optimized for their own services and outsource manufacturing to foundries. The aims are higher performance and power efficiency than general-purpose products and lower procurement costs.
- A. Second sourcing means being able to procure equivalent parts from multiple suppliers.
- B. The silicon cycle is the cycle of market booms and busts.
- C. Correct. These are chips designed for the company's own uses.