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Tom’s Hardware
Tom’s Hardware
Technology
Andrew E. Freedman

Intel reportedly gave up a chance to buy a stake in OpenAI in 2017

Intel Logo.

Unlike rivals like Nvidia and AMD, Intel hasn't made a massive splash in artificial intelligence products aside from some laptop chips with NPUs. According to a report from Reuters, things could have gone differently. In 2017 and 2018, Intel had an opportunity to buy a stake in OpenAI, which was then a tiny non-profit research firm.

The report, citing four people with knowledge of the situation, suggests that Intel and OpenAI discussed several different investment options, including purchasing a 15% stake in the company for $1 billion or taking a stake in OpenAI while selling hardware to the AI company "at cost price."

Former Intel CEO Bob Swan reportedly scuttled the deal because had didn't see AI models hitting the broad market anytime soon, which would mean that Intel wouldn't be repaid on its investment. OpenAI launched ChatGPT to massive acclaim in 2022. Additionally, the sources said that Intel's data center unit "did not want to make products at cost.

On OpenAI's side, teaming up with Intel would mean it wouldn't have been as dependent on Nvidia. Nvidia has since become the biggest name in AI hardware with its GPUs.

Microsoft poured billions into OpenAI in 2019, 2021, and 2023, turning the company into a big player on the AI stage. AMD, too, has become an AI company, though perhaps not on Nvidia's scale. AMD's data center business has boomed with the AMD Instinct MI300.

In its recent earnings, Intel's data center and AI Group (DCAI) reported reduced revenue and operating income. Still, its Xeon 6 'Sierra Forest' processor is in volume production, and Intel is set to start shipments for Xeon 6 'Granite Rapids' CPU. The company's Gaudi 3 AI accelerators are projected to ramp up in the second half of the year. Intel has suggested it has "over 20 customers" set to use Gaudi 3.

Neither Intel nor OpenAI responded to requests for comment before publication.

As CEO of Intel from 2018 (interim CEO) to 2021 (when he was replaced in the full-time gig by Pat Gelsinger), Swan often faced criticism due to a lack of technical acumen. He has previously served as the company's CFO, focusing more on the books than the tech. In retrospect, this missed opportunity to get in on AI earlier may further cement Swan's legacy.

Swan's predecessor, Brian Krzanich, bought Nervana Systems 2016 to compete with Google's tensor processing units. IN 2019, Intel purchased another AI startup, Habana Labs, and prioritized it over Nervana, shuttering the latter. Intel also owns Movidius, which it bought in 2016 for its vision processing units.

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