Meta Plans To Pump Billions Into AI Chips As The 'AI War' Intensifies
AInvestFriday, Jan 19, 2024 4:10 am ET
2min read
META --

Mark Zuckerberg announced on Instagram yesterday that Meta plans to strengthen its artificial intelligence research team and replenish its AI infrastructure ammunition by purchasing 350,000 H100 GPU chips from Nvidia by the end of this year.

This acquisition will bring Meta's total number of GPUs to about 600,000 and make it one of the world's most powerful AI systems.

Zuckerberg's statement drove its stock price up by more than 2% at closing that day. On the same day, Nvidia and AMD's stock prices also hit historic highs, with Nvidia's stock price increasing by nearly 2%, and its market value reaching a new high of $1.4 trillion.

Each Nvidia H100 chip is priced between $25,000 and $30,000, according to projections by Raymond James' analysts. Based on this price range, Meta's expenditure on these chips will approach ten billion dollars.

Yann LeCun, Meta's Chief Scientist, emphasized the importance of GPUs in building General Artificial Intelligence (AGI) at an event held in San Francisco last month. He said, [If] you think AGI is in, the more GPUs you have to buy. There is an AI war, and Nvdia is supplying the weapons.

Meta's Q3 earnings report indicates that by 2024, Meta's total spending will be between $94 billion to $99 billion, partly due to an expansion in computational power.

Since the second half of last year, major tech companies have been ramping up the deployment of AI chips. For instance, Amazon announced last autumn that it is constructing a system that includes 100,000 Trainium2 chips, and Oracle launched a system that includes 32,000 Nvidia H100 GPU chips.

Meanwhile, last year, Meta also launched a commercial version of the large language model Llama, the advertising tool TextPlanet, as well as a pair of smart glasses with direct access to the ChatBot Meta AI.

Zuckerberg also mentioned plans to tie AI investment to their AR/VR-driven Metaverse vision and to launch the next version of the Llama large language model.

Although the business model for generative AI is still uncertain, it is clear that companies are doing everything possible to profit from it, which has drawn the attention of the United Nations.

The currently ongoing Winter Davos Forum is focusing on the risks and challenges of AI development. United Nations Secretary-General Antonio Guterres issued a warning at the Davos World Economic Forum meeting that large tech companies are pursuing the profits of AI irresponsibly and need to take urgent action to mitigate the rapidly growing risks brought by the industry.

In response to these concerns, Zuckerberg said that Meta plans to responsibly work on its as-yet undeveloped artificial general intelligence, an approach it also took with its Llama project, share the pre-trained models and parameters of Llama 2, as well as provide a commercial license that would enable other companies to share technology and resources and accelerate the progress of large models.


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