Google Considers Dropping Broadcom as Supplier of AI Chips by 2027
Alphabet-owned Google is reportedly considering ending its partnership with Broadcom as a supplier of artificial intelligence (AI) chips by 2027. The tech giant plans to design the chips, known as tensor processing units, in-house if the change occurs. This decision comes after a pricing disagreement between the two companies.
The potential shift in supplier aligns with Google’s increased focus on generative AI, following the success of Microsoft-backed OpenAI’s launch of ChatGPT last year. Generative AI is projected to account for more than 25% of Broadcom’s semiconductor revenue in the coming year, according to Broadcom CEO Hock Tan.
In addition to considering dropping Broadcom, Google has been working since last year to replace the supplier with chipmaker Marvell Technology. This effort is part of Google’s overall strategy to enhance its AI capabilities internally. The advanced chip developed by Marvell for Google is internally known as Granite Redux.
The discussions surrounding the change in AI chip suppliers have caused a 5% decrease in Broadcom’s shares during premarket trading. However, both Google and Marvell have yet to respond to Reuters’ request for comment on the matter.