Nvidia invests $3.5 billion in MediaTek for custom AI chips

In short: Nvidia is investing $3.5 billion in MediaTek to help it build custom AI chips that can work smoothly inside Nvidia-powered data centers.

What happened

Nvidia said it will invest $3.5 billion in Taiwan-based chipmaker MediaTek. As part of the deal, MediaTek will adopt Nvidia technology to design custom chips for AI companies and big cloud providers.

Those custom chips are meant to plug directly into data centers already built around Nvidia hardware. A data center is a warehouse full of computers that run apps and AI for companies.

A key part of the partnership is MediaTek getting access to Nvidia’s NVLink Fusion ecosystem. NVLink is a fast connection that helps chips talk to each other (like giving computers a faster internal highway instead of small local roads), even when the chips are not made by Nvidia.

The timing matters because more big players are building their own AI chips to reduce how much they rely on Nvidia’s GPUs, including Amazon, Google, Microsoft, OpenAI, and Anthropic. TechCrunch reports Nvidia is responding by trying to stay central to the overall setup, even if some of the chips inside the servers are made by others.

Nvidia also recently announced a similar NVLink Fusion partnership with Amazon Web Services, and AWS plans to deploy 2 million more Nvidia GPUs.

Why it matters

For regular people, this is about who controls the “plumbing” behind AI. If Nvidia can make its systems the standard way chips connect inside data centers, it can keep influence over how AI services are built and priced, even as more companies use custom chips.

Source: TechCrunch AI