Had Intel made a single investment, its lagging fate might have been different.
In 2017 and 2018, the technology company had the opportunity to acquire a 15% stake in OpenAI for $1 billion, Reuters The report quoted four people with direct knowledge of the discussions. On top of that, Intel could buy an additional 15% stake if it provides hardware to OpenAI at cost, two people familiar with the matter said.
OpenAI sought investors from Intel because it would reduce the startup’s reliance on Nvidia, whose chips are now a mainstay in artificial intelligence.
But Intel walked away from the deal, in part because it believed generative AI models wouldn’t gain traction in the near future, leaving the company unable to recoup its investment, according to three sources interviewed. Reuters.
An Intel spokesman declined to comment. wealth.
Since then, Intel has struggled to gain a foothold in the hot field of artificial intelligence, and its stock price has plummeted, down 58% this year alone. Meanwhile, OpenAI leads the market after releasing its popular artificial intelligence chatbot ChatGPT in 2022. Worth $80 billion.
Although Intel was one of the world’s most important chipmakers two decades ago, the company failed to take full advantage of the artificial intelligence boom that turned rival Nvidia into one of the world’s most valuable companies. .
For years, Intel has focused its resources on supporting CPUs, such as those that power laptops and desktops, to handle AI processes, rather than prioritizing GPUs, the graphics chips used in games that can be more efficient. efficiently handle the massive calculations required for AI, Reuters reported. In contrast, while competitors such as Nvidia and Advanced Micro Devices (AMD) have found success using GPUs, Intel has largely missed the boat. In the third quarter, Intel will release its Gaudi 3 AI chip, which CEO Pat Gelsinger said will be able to outperform Nvidia’s H100 GPU.
Intel’s financial report last week was far below analysts’ expectations, resulting in a single-day drop of 26%, and the market value fell below $100 billion for the first time in 30 years. Kissinger told employees last week that the company would cut 15% of its workforce, or about 15,000 jobs, to cut costs.
“Simply put, we must align our cost structure with the new operating model and fundamentally change the way we operate,” Kissinger wrote in the memo.
Intel’s abandonment of its investment in OpenAI reflects the missed opportunities of other large companies that failed to see the future clearly. In 2000, Blockbuster turned down a $50 million offer to acquire fledgling Netflix. Today, the streaming company has a market value of more than $250 billion. During the tech boom of the late 1990s, Yahoo turned down an opportunity to acquire Google for $1 million.
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