Intel Corp on Tuesday announced a new line of microprocessors for data centers, setting up a battle with Advanced Micro Devices and others for the lucrative business of supplying the chips that power cloud computing.
The new Xeon Scalable Processor chips provide far greater support for next-generation computing applications such as artificial intelligence and driverless cars, Intel artificial intelligence products group vice president Naveen Rao told reporters.
The chips are aimed at companies including Alphabet’s Google, Microsoft Corp, Amazon.com Inc and others that operate datacenters with thousands of computers, both to power their own services and to provide computing horsepower for customers who do not want to own and maintain computer systems.
Google Cloud Platform was the first data center to adopt the new Intel processors.
Paul Nash, project manager for Google Compute Engine, called the deal an “expansion and deepening of our partnership” with Intel.
However, Intel will face stiff competition from historic rival AMD, which recently launched its own next-generation data center processor.
The big Internet companies are also doing more of their own hardware design, and experimenting with chips based on technology from ARM Holdings and others, partly as a way of pushing Intel to keep prices in line.
Martin Reynolds, an analyst at Gartner Inc, said the new Intel processor is a step up from its previous generation with better power efficiency, improvement on artificial intelligence workload and more advanced storage.
The biggest risk for Intel might be its dependence on a relatively small number of big datacenter operators, Reynolds said.
“The challenge now is so much of our their work is going to these big Internet guys,” he said.
Thus demand for chips would be subject to how successful the companies are in the fierce battle for customers who are moving their computing to the cloud, he added.
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