Amazon Unveils Trainium2: A New Cloud AI Chip to Escalate Microsoft Rivalry

Amazon Stock (NASDAQ:AMZN) made waves on Tuesday with the announcement of Trainium2, its latest artificial intelligence chip designed for the company’s cloud computing service. This move intensifies the ongoing competition between Amazon and Microsoft in the race to dominate the artificial intelligence market.

During a conference in Las Vegas, Amazon Web Services (AWS) Chief Executive Adam Selipsky revealed Trainium2 as the second generation of chips specifically crafted for training AI systems. Selipsky highlighted that the new version boasts four times the speed of its predecessor while being twice as energy-efficient.

This strategic move by AWS follows closely on the heels of Microsoft’s recent introduction of its own AI chip, Maia. Trainium2 will enter the competitive arena against AI chips offered by Alphabet’s Google, including its Tensor Processing Unit (TPU), which has been available to cloud computing customers since 2018.

Selipsky stated that AWS plans to roll out the new training chips starting next year. The surge in the development and deployment of custom chips is driven by the urgent need for computing power to advance technologies such as large language models, which are fundamental to services like ChatGPT.

In addition to introducing Trainium2, both Amazon and Microsoft are positioning their custom chips as complementary to Nvidia, the current market leader in AI chips, whose products have faced shortages over the past year. In a strategic move, AWS also announced on Tuesday its plan to offer Nvidia’s latest chips on its cloud service.

As part of the Tuesday announcements, Selipsky introduced Graviton4, AWS’s fourth custom central processor chip, claiming it to be 30% faster than its predecessor. This revelation comes shortly after Microsoft’s announcement of its own custom chip, Cobalt, designed to compete directly with Amazon’s Graviton series.

It’s worth noting that both AWS and Microsoft are leveraging technology from Arm Ltd in the development of their chips, marking a continued shift away from chips manufactured by Intel and Advanced Micro Devices in the realm of cloud computing. Oracle, another key player in the cloud service domain, has opted for chips from startup Ampere Computing for its cloud infrastructure.

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