This article first appeared on GuruFocus.
Alphabet (GOOG, Financials), the technology company behind Google Search, YouTube and Google Cloud, is trying to sell more of its custom AI chips to outside cloud providers, putting it in more direct competition with Nvidia.
Google has approached so-called neocloud companies about using its tensor processing units, or TPUs, according to a report from The Information. These specialized cloud providers rent computing power to AI developers and businesses.
The challenge is that Nvidia already has deep relationships with major players such as CoreWeave, Nebius and Lambda. One provider, Nscale, reportedly told Google that its active projects remain centered on GPU capacity.
Still, Google may find openings with smaller firms that are less tied to Nvidia. Its TPUs are already used by customers including Anthropic, Meta and Apple.
Google is also working with Blackstone on a new cloud venture that plans to rent TPU capacity to AI labs and financial firms next year.
For investors, the effort could give Alphabet another way to earn money from technology it once kept mostly in-house. The next test is whether outside cloud providers are willing to build around Google’s chips instead of Nvidia’s widely used platform.
