SoftBank has reportedly decided against using Intel's foundry for its ambitious AI venture, Project Izanagi, and is opting for TSMC instead. The conglomerate aims to challenge NVIDIA in the AI accelerator market by developing its own AI processors. This decision marks another setback for Intel, which has faced several challenges recently. In February 2024, reports emerged that SoftBank's CEO, Masayoshi Son, planned to invest up to $100 billion to create a company similar to NVIDIA, focused on selling AI accelerators. Although SoftBank initially worked with Intel, it recently switched to TSMC, citing concerns about Intel's ability to meet demands for "volume and speed."

The decision, reported by the Financial Times, raises questions about Intel's future involvement and how SoftBank's ownership of Arm Holdings will factor into the project. While TSMC is now SoftBank's choice, the foundry is already operating at full capacity, making it uncertain how it will accommodate this new venture. Neither SoftBank, Intel nor TSMC has commented on the situation, but given the complexities involved, it will likely take time for this plan to materialize. SoftBank will need to replicate NVIDIA's entire ecosystem, from chip design to data centers and a software stack rivaling CUDA, a bold and ambitious goal.

Japanese tech billionaire and founder of the SoftBank Group, Masayoshi Son, is embarking on a hugely ambitious new project to build an AI chip company that aims to rival NVIDIA, the current leader in AI semiconductor solutions. Codenamed "Izanagi" after the Japanese god of creation, Son aims to raise up to $100 billion in funding for the new venture. With his company SoftBank having recently scaled back investments in startups, Son is now setting his sights on the red-hot AI chip sector. Izanagi would leverage SoftBank's existing chip design firm, Arm, to develop advanced semiconductors tailored for artificial intelligence computing. The startup would use Arm's instruction set for the chip's processing elements. This could pit Izanagi directly against NVIDIA's leadership position in AI chips. Son has a chest of $41 billion in cash at SoftBank that he can deploy for Izanagi.

Additionally, he is courting sovereign wealth funds in the Middle East to contribute up to $70 billion in additional capital. In total, Son may be seeking up to $100 billion to bankroll Izanagi into a chip powerhouse. AI chips are seeing surging demand as machine learning and neural networks require specialized semiconductors that can process massive datasets. NVIDIA and other names like Intel, AMD, and select startups have capitalized on this trend. However, Son believes the market has room for another major player. Izanagi would focus squarely on developing bleeding-edge AI chip architectures to power the next generation of artificial intelligence applications. It is still unclear if this would be an AI training or AI inference project, but given that the training market is currently bigger as we are in the early buildout phase of AI infrastructure, the consensus might settle on training. With his track record of bold bets, Son is aiming very high with Izanagi. It's a hugely ambitious goal, but Son has defied expectations before. Project Izanagi will test the limits of even his vision and financial firepower.

Elon Musk has formed a new AI-focused company, as reported by the Wall Street Journal yesterday. The entity registered under the name X.AI was incorporated via a filing in Nevada last month, and Musk appears to be listed as the company's only director with Jared Birchall joining him under the role of secretary. Birchall heads the Musk family office, Excession LLC, and he serves as CEO of Neuralink - a neurotechnology company that was co-founded by Musk back in 2016. It is widely speculated that Birchall serves as a type of fixer - go watch the TV series "Ray Donovan" if you would like to observe a crude (and obviously fictional) example - in corporate affairs.

Reports emerged earlier this week, with Musk being at the forefront of a massive purchase of GPUs destined to arrive shortly at his data centers - this impressive chunk of hardware is speculated to power AI-related number crunching at Twitter in the near future. The founding of X.AI could provide another home for a portion of the 10,000 GPU order, but industry insiders firmly believe that Twitter will need to tool up quickly for its new AI-driven endeavor - the GPUs will likely be set to work on a ChatBot system to underpin the social media platform. Musk has already recruited researchers from DeepMind and setup a lab for them at one of his operations. It remains to be seen how the X.AI startup will run alongside efforts at other Musk-owned companies - it is theorized that he wants to beat OpenAI at their own game, and compete with similar undertakings at Google, Microsoft and Amazon.