Artificial intelligence

Google reduces costs with MediaTek in AI chip development

Google is set to collaborate with Taiwan’s MediaTek on the next generation of its Tensor Processing Unit (TPU) chips, which are expected to be produced next year.

The partnership is partly driven by cost considerations, as MediaTek offers Google a lower price per chip than its long-time partner Broadcom. MediaTek’s close ties with Taiwan Semiconductor Manufacturing Company (TSMC) also played a role in Google’s decision.

Despite the new partnership, Google has not severed ties with Broadcom, which has exclusively worked on its AI chips for several years.

Broadcom remains involved in the project, and an employee at the company confirmed that the relationship with Google is still intact. Google has been developing its own AI server chips, allowing it to reduce reliance on Nvidia, whose processors dominate the industry.

Google introduced its sixth-generation TPU last year to provide itself and its cloud customers with an alternative to Nvidia’s highly sought-after chips. The company reportedly spent between $6 billion and $9 billion on TPUs in 2023, based on revenue targets from Broadcom.

By bringing MediaTek into the fold, Google aims to strengthen its AI chip strategy while managing production costs more efficiently.

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Elon Musk’s xAI expands with Hotshot acquisition

xAI, Elon Musk’s AI company, has acquired Hotshot, a San Francisco-based startup focused on generative AI video tools.

The company, founded by Aakash Sastry and John Mullan, initially developed AI-driven photo editing tools but shifted its focus to text-to-video AI models.

Hotshot’s video foundation models, such as Hotshot-XL and Hotshot Act One, have already gained significant attention in the AI industry.

The acquisition is expected to boost xAI’s plans to develop its own video generation models, competing with major competitors like OpenAI’s Sora and Google’s Veo 2.

Musk had previously hinted at the creation of a ‘Grok Video’ model, which he anticipates launching in the near future. Hotshot’s team will likely play a key role in scaling these efforts, using xAI’s powerful infrastructure, including the Colossus cluster.

Hotshot’s website has confirmed the sunsetting of its video creation tools as of March 14, with existing customers having until March 30 to download their content.

The specifics of the staff transition to xAI remain unclear, with Sastry declining to comment. This acquisition represents a significant step for xAI in the rapidly evolving generative AI space.

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Palmetto leverages AI to revolutionise home electrification across the US

Palmetto, known for its innovative approach to residential solar installations, is now focusing on the broader electrification of US homes using AI.

The company has developed an AI-powered tool that simulates digital twins of homes across the country, which will help determine how technologies like heat pumps and solar panels can be effectively deployed in individual homes.

By using public and private data, Palmetto’s AI can infer critical information about a home, such as insulation types and building materials, to optimise energy efficiency.

As the residential solar market slows, Palmetto has expanded its software to include electrification solutions beyond solar, including backup batteries and heat pumps.

The company has now made its tool available to external developers through an API, allowing them to create new applications that can speed up the electrification process.

Palmetto hopes that developers will build tools that can quickly address the demand for these technologies, which will be essential in the US effort to reduce carbon emissions.

The company’s AI system analyses over 60 characteristics of homes, including details like the construction year and materials used, to make accurate energy efficiency predictions.

However, this tool will also offer developers insights into the growing electrification market. With an API offering 500 free calls per month, Palmetto’s strategy allows for scalable growth while providing key data for the company’s future development.

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Intel’s new CEO plans major changes to revive the company

Intel’s incoming CEO Lip-Bu Tan is considering major changes to the company’s chip manufacturing and AI strategies to revive the struggling tech giant.

Sources revealed that Tan aims to restructure Intel’s approach to AI and implement staff cuts to streamline operations, focusing on addressing slow-moving middle management.

One of Tan’s core priorities is revamping Intel’s manufacturing operations, which have expanded to include producing semiconductors for external clients like Nvidia.

The changes come as Intel looks to regain its competitive edge after a decade of missed opportunities in smartphone chips and AI processors, allowing competitors such as Arm Holdings and Nvidia to dominate.

At a recent town hall, Tan told employees that the company would need to make ‘tough decisions’ to improve performance. Intel’s shares rose over 8% following his appointment, as investors await further details on his plans.

Tan’s immediate focus includes bolstering Intel Foundry’s performance and attracting new customers in sectors such as AI and robotics.

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Samsung faces tough shareholder meeting over AI struggles

Samsung Electronics faces a challenging annual general meeting as shareholders express frustration over its failure to capitalise on the AI boom.

Despite being South Korea’s most valuable company, Samsung’s stock tumbled nearly a third last year, making it one of the worst-performing tech firms.

Executives, including Co-CEO Han Jong-hee, will address concerns over lagging innovation, competition in semiconductor technology, and strategies to counter US tariffs.

Internal discussions at Samsung have revealed concerns about losing its technological edge, particularly in high bandwidth memory (HBM) chips, where it trails rival SK Hynix.

Chairman Jay Y. Lee reportedly criticised the company for focusing on maintaining the status quo rather than driving major innovation.

A stagnation like this has contributed to Samsung losing market share to competitors like TSMC in chip manufacturing and Apple in smartphones.

Adding to its challenges, Samsung has warned of sluggish AI chip sales due to US export restrictions to China, its biggest market. This puts the company at greater risk from potential US tariffs on Chinese trade.

In an attempt to regain investor confidence, Samsung launched a $7.2 billion share buyback plan in November, which has helped its stock recover slightly. However, shareholders remain sceptical about its future growth strategy.

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Tencent unveils new AI tools for 3D visuals

Tencent has unveiled a suite of new AI tools aimed at converting text and images into 3D visuals, showcasing China’s growing presence in the generative AI field.

The company launched five open-source models based on its Hunyuan3D-2.0 technology, including turbo versions capable of producing high-quality 3D visuals in 30 seconds.

A release like this follows Tencent’s push to challenge US dominance in AI, with competitors like AI startup DeepSeek offering similar performance at lower costs.

The launch of Hunyuan3D-2.0 builds on the company’s earlier introduction of 3D AI models, targeting designers and game developers to establish a competitive edge in text-to-3D and image-to-3D generation.

Tencent’s new models are praised for superior text consistency, geometric accuracy, and visual quality compared to leading industry benchmarks.

Meanwhile, ByteDance, the parent company of TikTok, has also entered the text-to-3D market with its VeOmniverse model, though it remains proprietary.

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OpenAI expands ChatGPT capabilities with Google Drive and Slack integration

OpenAI is preparing to beta test its new feature, ChatGPT Connectors, which will enable businesses to link their Google Drive and Slack accounts to ChatGPT.

Employees can leverage internal company data, including files, presentations, and Slack discussions, to enhance their interactions with the AI chatbot.

The feature will provide answers informed by these internal resources, similar to how ChatGPT currently uses web search to answer general queries.

The initial beta testing will be available to ChatGPT Team subscribers, with plans to extend the functionality to other platforms, such as Microsoft SharePoint and Box.

The move is part of OpenAI’s effort to integrate ChatGPT deeper into business operations, aiming to make it an essential tool for workplace productivity.

While some companies have expressed concerns about sharing sensitive data with AI, ChatGPT Connectors offers reassurances that permissions from Google Drive and Slack will be fully respected and up-to-date.

The ChatGPT Connector model is powered by OpenAI’s GPT-4o, which can refine responses based on a company’s internal knowledge. However, the integration has certain limitations.

For example, it cannot analyse images in Google Drive files or access private Slack messages and group chats. Additionally, companies must provide OpenAI with select documents and conversations for the beta test, though OpenAI assures that no data will be directly used for training the AI.

Enterprise AI-powered search tools may see a significant impact from this development, creating challenges for competitors in the industry.

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Semiconductor industry’s environmental impact calls for EU action

The European Union is being advised to strengthen its focus on sustainable semiconductor production as emissions from the industry continue to rise.

A new study by the think-tank Interface highlights the growing pollution caused by the manufacturing of cutting-edge chips, essential for AI technology.

Over the past eight years, global energy consumption in the semiconductor sector has surged by 125%, largely due to the increasing demand for advanced chips, which require higher energy input and generate more emissions.

While the industry’s high-emission production methods have raised concerns, the report also points to opportunities for Europe to capitalise on its strengths in the manufacturing of ‘legacy’ chips.

These chips, used in sectors like automotive, energy, and industrial applications, tend to have a smaller environmental footprint. European companies such as STMicroelectronics, Infineon, and NXP are already market leaders in this area, which could be key to the EU’s efforts to foster a greener transition.

Despite the EU’s ambitions, including the 2023 Chips Act aimed at boosting production, questions remain over whether Europe should invest further in cutting-edge chip manufacturing.

The study suggests that pursuing this route could have significant environmental costs, particularly due to the high energy consumption involved. However, the EU’s access to renewable energy sources and water might provide an advantage over the high-cost, energy-hungry production processes in Asia.

Julia Hess, the study’s lead author, argues that chips manufactured under higher environmental standards could offer Europe a long-term competitive edge in the semiconductor industry, driving both sustainability and technological leadership.

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US bans Chinese AI LLM DeepSeek from government devices

Several US Commerce Department bureaus have recently prohibited using the Chinese AI model DeepSeek on government-issued devices, according to internal communications and sources familiar with the matter.

A mass email circulated among staff emphasised the importance of safeguarding departmental information systems, instructing employees to refrain from downloading, viewing, or accessing any applications, desktop apps, or websites associated with DeepSeek. ​

The case reflects escalating apprehensions among US officials and legislators regarding data privacy and the potential exposure of sensitive government information through DeepSeek’s usage.

In February, Representatives Josh Gottheimer and Darin LaHood, House Permanent Select Committee on Intelligence members, introduced legislation to ban DeepSeek on government devices. They also contacted state governors, urging similar prohibitions at the state level. In a letter dated 3 March, the lawmakers cautioned that using DeepSeek could inadvertently share highly sensitive and proprietary information with the Chinese Communist Party, including contracts, documents, and financial records. ​

Several states, including Virginia, Texas, and New York, have already implemented bans on DeepSeek for government devices. A coalition of 21 state attorneys general has called on Congress to enact comprehensive legislation addressing this issue.

The concerns stem from DeepSeek’s rapid emergence as a low-cost AI model, which has disrupted global equity markets and posed a potential threat to the United States’ leadership in AI. ​

Stay updated on DeepSeek developments!

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Treasury eyes AI-driven future as IRS technology review begins

The US Internal Revenue Service (IRS) is pausing its technology modernisation efforts to evaluate the impact of AI on tax collection and operations, a senior official announced.

The review will include recent initiatives such as the Direct File system, which allows US taxpayers to submit returns for free. AI-driven advancements in customer service and data processing have raised questions about the agency’s long-term strategy.

As the Trump administration prepares for widespread staff reductions in federal agencies, a source familiar with IRS plans indicated that up to a quarter of the agency’s workforce could be cut.

The IRS has not confirmed specific numbers but acknowledged that changes in technology could lead to a realignment of staff. Treasury Secretary Scott Bessent has expressed confidence that AI will improve tax collection efficiency, though no official budget or workforce reduction targets have been set.

The pause reflects shifting priorities in IRS funding, which was originally bolstered by the 2022 Inflation Reduction Act. Republican lawmakers have pushed to reduce the agency’s modernisation budget, arguing that enhanced funding could lead to unnecessary audits.

Despite the pause, the IRS has assured taxpayers that the 2025 filing season will not be affected, with tax returns and refunds continuing as usual.

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