By Laura Bratton
Publication Date: 2026-02-07 15:00:00
The race to dominate the burgeoning AI market is pushing tech giants to adopt business models reminiscent of IBM’s (IBM) in the 1960s.
Big Tech “hyperscalers” Alphabet (GOOG, GOOGL), Meta (META), Microsoft (MSFT), and Amazon (AMZN) are all in various stages of developing their own custom AI chips to put in their data centers and power their cloud and software offerings. Alphabet, the farthest along of the four companies, is even reportedly in talks to sell its physical chips called TPUs to Meta — a move that would see it go head-to-head with leading chipmaker Nvidia (NVDA).
Those efforts have led Bloomberg Intelligence analysts to predict the custom AI chip market will grow to $122 billion by 2033.
Big Tech’s production of their own components goes beyond chips: Microsoft and Amazon are actively investing in dark fiber, or currently unused fiber-optic cables that are already underground, RBC Capital Markets analyst Jonathan Atkin said in a recent note to clients….
