Japanese Startup Preferred Networks Targeting AI Chips' Security

Japanese startup Preferred Networks is increasing its investment in artificial intelligence chips to secure access to critical devices as artificial intelligence advances shake the world. The company, whose investments include Toyota and robot maker Fanuc, began developing the first generation of artificial intelligence chips for supercomputers in 2016.

"We knew we needed to optimize energy consumption and minimize procurement risk, which could make it difficult to sustain our business," Preferred Networks co-founder and CEO Toru Nishikawa said in an interview.

Companies worldwide are scrambling to secure AI chips amid excitement over the potential of the technology, with Amazon and Microsoft among firms designing chips in-house. Preferred Networks has completed the design of its second-generation AI chip, which is being manufactured by TSMC and will power its new supercomputer. The startup said its chips have been optimized for AI tasks, with lower power consumption and improved computing power, partly by transferring functions usually performed by hardware to software.

Preferred Networks plans to offer its latest technology for creating large language models, drug discovery next year and pure computing power to customers by 2027.