Japan's government-backed research group is joining forces with US startup Tenstorrent Inc. to develop an advanced AI chip. Led by industry Jim Keller, a former employee of Tesla Inc. and Apple Inc., Tenstorrent aims to provide customers with an alternative AI chip solution. The collaboration aligns with Japan's ambitious$67 billion plan to reclaim a central role in the semiconductor industry. The goal is to produce jointly designed AI chips at Rapidus Corp., a government-backed startup. At a joint event, Rapidus CEO Atsuyoshi Koike emphasised the importance of reducing power consumption in AI technology and expressed the hope that Tenstorrent's involvement will expedite the launch of AI accelerators.

Tenstorrent, which plans to begin chip production in 2027, will face stiff competition from industry leaders such as Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. However, Tenstorrent has already secured substantial business prospects in Japan, with expected deals worth hundreds of millions of dollars. The company is working closely with the Japanese government and corporations while ensuring compliance with US technology export controls.

As part of the collaboration, Tenstorrent will partner with the Leading-edge Semiconductor Technology Center (LSTC) in Japan to work on AI chip designs. Nonetheless, Rapidus' ambitious goal of manufacturing state-of-the-art 2-nanometer logic chips by 2027 may prove to be challenging.

The partnership between the research group and Tenstorrent has significant potential to advance Japan's position in the semiconductor industry, while also diversifying the AI chip market currently dominated by Nvidia Corp. and Arm Holdings Plc.