Apple plans to invest 750 billion yen over two years to catch up with the AI development race
With the rise of generative AI, various companies are investing large amounts of money in AI development, and Apple's CEO Tim Cook
How much does Apple need to invest annually in generative AI to catch up with the competition? A reasonable estimate starts at several billion US dollars / How much does Apple need to invest annually in generative AI to catch up with the competition? Reasonable reasoning, billions of beauty, and leap forward | by Ming-Chi Kuo | Oct, 2023 | Medium
https://medium.com/@mingchikuo/how-much-does-apple-need-to-invest-annually-in-generative-ai-to-catch-up-with-the-competition-56e237ea3feb
Apple AI server purchases could hit $5B over two years
https://appleinsider.com/articles/23/10/23/apple-could-spend-5b-on-servers-to-catch-up-in-ai-race
On October 22, 2023, Bloomberg reported that ``Apple has embarked on a $1 billion (approximately 150 billion yen) investment in the development of generative AI in order to introduce more AI functions to the next operating system.'' .
Following this, TF Securities analyst Ming-Chi Kuo suggested that Apple's investment in AI development 'could be close to $5 billion.'
How much does Apple need to invest annually in generative AI to catch up with the competition? A reasonable estimate starts at several billion US dollars / How much does Apple need to invest annually in generative AI to catch up with the competition? Reasonable reasoning for billions of beautiful people https://t.co/hJpMW5wUSa
— Ming-Chi Kuo (@mingchikuo) October 23, 2023
According to Kuo's own research, Apple plans to purchase 2,000 to 3,000 AI servers in 2023 and 18,000 to 20,000 in 2024. This corresponds to approximately 1.3% and 5% of the global AI server shipments from 2023 to 2024.
Regarding the AI server that Apple plans to purchase, Kuo said, ``It is reasonable to think that it is NVIDIA's HGX H100 , which is designed for the most popular generative AI training and inference.'' We also predict that AI servers shipping in Q4 2024 will likely be upgraded to B100.
The price per unit of HGX H100 is approximately 250,000 dollars (approximately 37 million yen). In other words, Apple will spend at least about $620 million (about 93 billion yen) in 2023 and $4.75 billion (about 710 billion yen) in 2024 to purchase AI servers.
The reason Apple's AI server purchases are significantly lower in 2023 than in 2024 is due to NVIDIA's AI chip supply shortage that began in the second quarter of 2023. Even if the supply of NVIDIA's AI chips improves in 2024, Apple's AI server purchasing status will lag far behind rival companies. Taking Meta as an example, the company will purchase approximately 40,000 AI servers in 2024, which is significantly more than Apple's purchase of AI servers in 2024.
Assuming that Apple does not offer services such as cloud hosting, it is inappropriate to compare it to companies like Microsoft (which plans to purchase approximately 80,000 to 100,000 AI servers in 2024).
When Apple trains large-scale language models, it would prefer to use AI servers it buys and sets up itself rather than a cloud service provider to ensure security, privacy, and design flexibility. , Kuo pointed out. They also point out that Apple's AI infrastructure has less computing power than its major competitors, so it will need superior software development capabilities to catch up.
Please note that the above cost calculation does not take into account personnel costs, operational costs, etc., so Apple will need to invest billions of dollars (hundreds of billions of yen) annually in order to catch up with competitors in AI development. Mr. Kuo noted that it is reasonable to estimate that. If Apple only spends $1 billion a year on generative AI development, ``I'm worried about the future of Apple's generative AI services,'' Kuo said.
Some may argue that Apple may develop its own AI server chips to save on the cost of procuring AI servers, but points out that this idea is premature at the time of writing. doing.
A forum related to this article has been set up on the GIGAZINE official Discord server. Anyone can write freely, so please feel free to comment!
• Discord | 'Do you think Apple can catch up with the AI race?' | GIGAZINE
https://discord.com/channels/1037961069903216680/1166304927170179142
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