Triple Click on AI Chips from AMD and Anthropic

0:00Anthropik is building their own custom silicone team to design their own AI chips and AMD has just unveiled something called the Helios rack system their goal is to challenge NVIDIA head on in AI data centers Anthropic is upgrading Claude's voice mode. It's going to be now running on Opus and Sonnet. And Google Cloud revenue jumped 82 % to$24.8 billion. If anyone has been following Google for the last few weeks when they've released how much their AI spending is and their stock took a massive hit, well, evidently, this is the reason why they announced that. OpenAI and Anthropic are both lobbying Washington to curb Chinese open-weight AI.

0:41We've talked about this a lot on the podcast, but this is kind of the latest news on the lobbying front. If you want to get a deep dive on these and a dozen more stories every single day, I'd love for you to check out AIChatDaily.com. That's my own sister website, new site that is partnered with this podcast. It's essentially like a show notes, but it also goes deeper and has extra stories I don't cover in here. There's dozens of stories every single day on all the latest AI news. and there's a newsletter that you can subscribe to on the website. So every single morning, if you like, you'll get the top five AI news stories straight into your inbox to keep you up to date with everything happening in AI.

1:19And you get some really quick breakdowns of all of the facts so that you understand what's going on. The website is AIChatDaily.com. The first story I wanted to talk about is the fact that Anthropic is building their own AI chip design team and it's going to be for creating custom hardware for Claude. It's the same thing that OpenAI, Google, and Meta, they're all doing it right now. And the big reason is everyone wants to get off of NVIDIA. These companies are incredibly dependent on NVIDIA. NVIDIA basically has quotas, and they dole out their GPUs and their chips, and they only give a certain amount to different companies, and nobody wants to feel bottlenecked by one player that they're obviously spending a ton of money on.

1:58So everyone's building their own chips. Right now, they're also scouting Samsung as a manufacturing partner, which is ending Anthropik status as the basically the last major AI lab without a public silicone program. They're like, all right, it's time to get serious on that one. Anthropik currently relies on a bunch of different suppliers. So there's AWS, Google, NVIDIA, AMD, all of them give them compute. But of course, that means that they don't get to control the pricing allocation or any of the roadmap timing. OpenAI shipped their Broadcom designed chip, which is called Jalapeno. It's an inference chip and that was in June of this year.

2:36Google now runs their own TPUs. Meta is building MTIA accelerators and Anthropic basically was the only one that wasn't working on this. Custom silicone typically takes between 18 to 24 months to design and it's going to cost hundreds of millions of dollars per chip version. But every single efficiency gain that they can get on this compounds across billions of dollars that Anthropic and is, you know, using for these Claude API calls. So I think this is something that is kind of a play on margin. It's not a shortcut. This is going to take a long time. Anthropic can tune memory and math formats to Claude's exact workloads in a way that no off the shelf GPU can really match.

3:13But they're also betting on a two year runway before any of that investment is going to get paid back. So this isn't something that's very quick. But over the long run, this might be a good play for them. After announcing a strategic partnership with Anthropic, AMD has just unveiled Helios, which is a rack system for AI data centers. And they're saying that this is basically a direct competitor to NVIDIA's products that they have right now. Microsoft, OpenAI, Meta, Oracle, and Anthropic have all committed to deploying it at a gigawatt scale. And it's going to be starting shipments later this year.

3:48Anthropic and AMD both announced a strategic partnership to deploy up to two gigawatts of GPUs on Helios, which is, you know, the exact same scale of NVIDIA's largest AI training cluster. So they're, you know, they're really being quite competitive in the market. AMD also introduced Venice X, which is a data center CPU designed to pair with Helios. That's going to be launching in 2027. And it's going to compete on kind of this full stack alternative to a lot of the different competitors that are out there. The CEO Lisa Su projected the AI accelerator market will reach 1.4 trillion by 2030 approaching the size of today's entire semiconductor industry.

4:27So you know this one segment of the market she's saying is going to be as big as the entire semiconductor industry. This is the first time that AMD has landed all five major frontier AI labs on a single rack platform. They have everyone signed up for it. I think this is showing that they're really like a strong contender for a quote unquote second place option for a lot of these massive AI infrastructure build outs that are coming up. The scale of all of these different deals that they've done with these five hyperscalers, I think they're all measured in gigawatts. And I think that shows that the hyperscalers are all of them are ready to diversify away from NVIDIA's almost complete dominance.

5:03So it looks like we're having a real second player in the market and AMD is going to get some serious market share. Does that, you know, is that like super bad for NVIDIA? I think their market is just going to keep growing like crazy, but there are other competitors now. Anthropic is upgrading Claude's voice mode. It's now going to work with their most powerful models, Opus and Sonnet. So I think in the past it was only working with Haiku. And I will say one thing that I actually did appreciate about this was I've been going back and forth between OpenAI and Anthropic as far as using like Claude co-work and ChatGPT work.

5:34and I did find that chat GPT work after they did their upgrade and everything's running on soul 5.6 Extra high when I go and ask it to complete a project for me and I'm doing the voice mode on it It takes a while for it to kind of transcribe and write it all down And it's actually kind of annoying the the leg is it's a few second leg and I noticed that it doesn't always happen But when you have soul 5.6 extra high on it does and so I actually appreciated that um anthropic when i was using claude it was like instantaneous transcription of what i was doing it was all on haiku now is it perfect is it the is it the best like there's a couple things that it might mess up but it was instantaneous and super fast well they're going to upgrade it because evidently they think that it needs to be a little bit higher quality so now they're putting it on opus and sonnet i hope they don't sacrifice too much of the speed because honestly that was my favorite thing they're going to be able to they're allowing you to plug that directly into gmail Google Calendar Slack Canva Notion.

6:28So you can now tell Claude by voice to do your emails. I mean, everything else that you've probably been doing, I even have like a literal, I have this device from OpenAI. It's like a little keyboard. It is, I think, built with work louder. And it literally just has a microphone button that I push. So this is the way I've been working a lot lately is just talking to these models and having them go and complete tasks for me. Instead of typing it out, I think it's what a lot of people are doing. There's a lot of software like Whisperflow that's out right now that does that kind of stuff. So a lot of different options.

7:00But Claude obviously decided they wanted to put a big upgrade here. Voice mode is now going to default to whatever Claude model you last used in text chat. So a Sonnet workflow is automatically going to have that for the audio, which is kind of what OpenAI is doing right now. And I'm not going to lie. That's actually annoying to me. I wish you could choose the audio. Honestly, what I find is when it does the transcription and when it types it out, I would actually rather a faster worse model because you can like many times I'm literally using Apple's like voice to text which is really ghetto not very good and when I when I do it there's like a bunch of typos but Claude understands and it literally fixes it and does everything the way I want so I find that Claude is very good at getting the meaning out I'd rather just have the underlying model better and having the voice transcription faster because I absolutely hate talking and then waiting five seconds for it to type out before I can hit send but I mean that's just me being impatient so I guess the quality improvement is probably good but I wish they would let you choose in the settings what model was powering your voice.

8:01Free users are going to keep getting haiku so maybe I gotta go switch to being just a free user just kidding and there's going to be paid users that get the opus and sonnet and all of the rest of it. They have a lot of different languages supported on this by the way English, French, German, Hindi, Japanese, Korean, Spanish and it you know of course auto detects it so that's fantastic. Google Cloud Revenue is up 82 % to$24.8 billion last quarter. That absolutely crushed the expectations that Wall Street had. I think it's proving that the company's huge AI spending is actually paying off. The$514 billion backlog of signed customer contracts, I think is showing that there is a huge demand for AI infrastructure and service is real and it's locked in for years.

8:46So a lot of these deals that Google cloud's doing. It's not just for this year or for this month, but these are multi-year deals. Cloud growth is accelerating really fast. It's up from 63 % last quarter to 82 % this quarter. It's mostly driven by a lot of different companies renting compute power and buying pre-built AI products from them. Gemini reached 950 million monthly active users. That's up from 750 two quarters ago. So the usage of their own products is accelerating, but also the amount of companies signing deals to power their AI on their infrastructure is also increasing. And Alphabet posted$112.1 billion in quarterly profit.

9:24That's almost four times the$28.1 billion from the same quarter last year. That is wild. $112 billion up to$21 billion just one year later. That's absolutely insane. Google's$180 billion to$190 billion in annual spending on data centers. and chips is now, you know, it's something that kind of crashed their stock a couple of weeks ago when it came out and everyone was like, oh my gosh, Google's overspending. But I think this is showing there is serious demand. The demand is accelerating like crazy. They know they're going to get that money back. And so I think they expect that 2027 is going to be when this massive build out starts turning into some real cash generation.

10:04But in order to get that money, like they have to spend, they got to spend the money to make the money, but they can see a lot of demand. So but evidently they're going all in. OpenAI and Anthropic are both lobbying US regulators to restrict Chinese open-weight AI models like Moonshot's Kimmy, you know, K3 came out a while ago and it was all the rage. And then we have the latest Quen model came out a few days ago. What they're saying here is that there are national security concerns. They, of course, are saying this at a time when it would be quite convenient. It would push these companies towards, you know, being the winners in this space.

10:39no one could really dethrone them none of these open source models could go scorched earth on them opening eyes dean ball argued the u.s should create regulatory fear uncertainty and doubt around open weight models to weaken their competitive position um and then he kind of walked that argument back but that was like his first thing we've heard this in in crypto a lot back in the day the fud um that he's you know openly saying that they should create some fud and he's like no no actually it's serious it's not it's not just fud for for fud's sake Like Kimmy's launch in at the end of last month, I think a lot of people were panicking.

11:13There is a viral demo showing it generating a Mac OS like UI mockup in 30 minutes. I think a lot of the hype faded after that. A lot of these demos are like, oh, my gosh, look at this crazy, crazy, incredible thing. And then once it actually comes out and people actually play with it, they're like, OK, it's not as crazy as it seems, which is why I'm actually a little skeptical. I mean, whatever. You can say I'm dumb, but it's why I'm a little skeptical of Anthropoc always hyping up their models to an insane degree, only giving them to enterprises, not to the regular people, and saying, look, it can do all these crazy things.

11:46I don't know. It makes me skeptical when they won't give it to you, but maybe it's truly dangerous. I don't know. This is the second time that we've had in the last under a year, basically, where we've had this kind of cycle where there's a huge cheaper model that comes out and it's super capable. DeepSeek had something that kind of was along these lines. And then afterwards, there's a bunch of policy restrictions that people were calling for after it came out. So I think we're seeing basically the same pattern play out over and over again. Chinese labs are going to ship like a super cheap open model.

12:15It's going to be really competitive in the benchmarks. A lot of the American executives are going to start warning about security and regulation and we need to have restrictions. And of course, the people that are really winning are those big closed model companies, OpenAI, Anthropic, etc. So I think whether those security concerns are legitimate or not, it doesn't change the fact that all of the people asking for these policy changes happen to be the people that are going to be winning from it. So I am a little bit skeptical of it, if I'm being honest. And I actually think open weight models are fantastic for innovation and like for my own company being able to use a model that's 90, you know, 90 % cheaper, 90 times cheaper than an open or than a closed source model, if it can do some of the same tasks that we needed to get down on a repeated basis.

13:01To me, that makes a lot of sense. But there's a lot of there's a lot of debate on this topic, for sure. Guys, thank you so much for tuning into the podcast. If you enjoyed this episode, make sure to leave a rating and review wherever you get your podcast. If that's over on Spotify, you got to hit the about tab. If it's on Apple, you can leave a little comment, drop some stars. I know people have complained that Apple's not intuitive for leaving reviews, but go to the main podcast page, scroll down, hit some stars, leave a review. It helps us show out so much. I would be incredibly grateful. Go check out AIChatDaily.com if you want to get all of these news stories in article format.

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