Intel spins out AI software firm with backing from DigitalBridge

Digitalbridge

03/01/2024 13:30

By Stephen Nellis
       Jan 3 (Reuters) - Intel  INTC.O  on Wednesday said it
was forming a new independent company around its artificial
intelligence software efforts with backing from digital-focused
asset manager DigitalBridge Group  DBRG.N  and other investors.
    Intel executives would not comment on the value of the deal
or whether it would retain a majority stake in the new venture,
other than to say the firm would have an independent board of
directors and the chipmaker would remain a shareholder.
    The new entity, which will not be publicly traded and will
be called Articul8 AI (pronounced "Articulate AI"), is an
outgrowth of work on corporate AI technology that Intel
initially carried out with Boston Consulting Group (BCG). 
    Using one of its own supercomputers, Intel developed a
generative AI system that can read text and images using a
combination of open-source and internally developed technology.
Intel then modified that system to run inside BCG's own data
centers to help address BCG's privacy and security concerns.
    Arun Subramaniyan, who was formerly vice president and
general manager in Intel’s data center and AI group and will
become chief executive of Articul8, said many other potential
customers expressed similar reservations about turning their
data over to large cloud computing companies for AI work. 
    He also said potential customers were concerned about
runaway costs if thousands of their employees start using the
systems.
    "We've been really trying to address the biggest gap in
generative AI today, which is that building a proof of concept
is easy, but getting things into production and doing it safely
and in a cost sustainable way is really what is missing,"
Subramaniyan said in an interview.
    Intel's move to create Articul8 is its latest move to seek
outside capital for business units. 
    The chipmaker spun out car chip firm Mobileye Global
 MBLY.O  and plans an eventual initial public offering of its
programmable chip unit. 
    Beyond DigitalBridge, which is publicly traded and a major
investor in data centers, other Articul8 investors include Fin
Capital, Mindset Ventures, Communitas Capital, GiantLeap
Capital, GS Futures and Zain Group. 

 (Reporting by Stephen Nellis in San Francisco; Editing by Jamie
Freed)
 ((Stephen.Nellis@thomsonreuters.com;))