Alibaba and Baidu Invest in Phytium, an Independent Core Chip Vendor

Chinese business inquiry platform Tianyancha showed on Friday that Phytium has undergone changes to its industrial and commercial registration information recently, adding as shareholders Hangzhou Alibaba Venture Capital Management Co., Ltd., China Internet Investment Fund (Limited Partnership), Baidu affiliated company Dazi Bairuixiang Venture Capital Management Co., Ltd. and others. At the same time, the company’s registered capital increased from 667 million yuan ($104 million) to 749 million yuan.

According to the company’s official website, Phytium is a leading vendor focusing on homegrown core chips in China – headquartered in Tianjin – and was jointly established by China Electronics Corporation, Tianjin Binhai New Area Government and Tianjin Advanced Technology Research Institute in 2014.

The chip market is currently booming. A report released by iiMedia Research in September 2020 pointed out that in 2019, the global artificial intelligence (AI) chip market was $11 billion. By 2025, this figure is expected to reach $72.6 billion, and its compound annual growth rate is expected to be 93.3%.

According to 21Tech, a number of internet giants are chasing chips enthusiastically.

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In 2018, Baidu released the cloud full-featured AI chip “Kunlun.” In June this year, Baidu announced the establishment of an independent new company in its Kunlun chip business, named Kunlun Chip (Beijing) Technology Co., Ltd. Kunlun Chip had completed independent financing in March, with a valuation of about 13 billion yuan.

At the Apsara Conference in September 2018, Alibaba announced the establishment of T-Head Semiconductor Co., Ltd., which was formed by the integration of C-SKY, previously acquired by Alibaba, and the self-developed chip business of Alibaba DAMO Academy. Its main task is engaged in self-research and development as well as strategic layout of chips.