Tencent revealed its progress in chips for the first time. Silicon appears remote to the main arenas of video games and social networks,which signals Tencent's alignment with China's long-run goals to self-develop semiconductors similar to moves by other tech firms from Alibaba, to Baidu, to Huawei, who have developed their in-house chips. However considering the large volume of data that Tencent handles, one may wonder why it didn't develop semiconductors sooner. 

Tencent's three unveiled chips are all custom built: one for AI inference, one for video transcoding, and another for network interface. With over one billion monthly users on its flagship WeChat messenger, Tencent has a lot of digital footprints to handle but has traditionally been reserved about exploiting personal data. Tencent has a slew of other business lines including Tencent News and Tencent Video that could benefit from greater machine learning power and are perhaps more eager to monetize. 

Dowson Tong, Tencent's senior vice president, explained that the firm's AI inference chip will be used for image and video processing, natural language processing and search, among other scenarios. The chip for video transcoding, as the name implies, will ensure smoothness and low latency as Tencent handles its massive video workload. Lastly, the smart network interface card (SmartNIC) will be used for CPU server offloads, according to Tong. Tencent will be collaborating with firms to develop an ecosystem around chip manufacture including Shanghai-based Enflame, which specializes in AI training chips..