Understanding AI Factories: Definitions, Roles, Benefits, and Challenges
• AI Factory is a concept referring to a comprehensive platform for large-scale data processing and training AI models, based on the hardware and software infrastructure developed by Nvidia.• AI factories play a crucial intermediary role in the global AI value chain, connecting input elements (hardware, software, and data) with output applications built on AI models.
• AI factories, instead of producing physical products like industrial manufacturing plants, create AI models and services that can be applied across various industries and sectors.
• As the value creation hub of the AI industry, AI factories hold significant short-term and long-term potential in the context of the rapidly growing demand for large-scale data processing infrastructure and AI model training. This growth is expected to accelerate in line with the overall AI industry's expansion. According to Infinitive Data Expert, the AI market is projected to reach USD 1.6 trillion by 2030, expanding at a CAGR of 39% from now until 2030.
• Investing in AI factories faces barriers such as very high initial investment costs, scarcity of specialized human resources, U.S. government regulatory restrictions on the export of high-capacity AI equipment, Technological Obsolescence risks, and dependence on a limited number of suppliers. To mitigate financial pressure and limit these risks, technology service companies often establish strategic partnerships with major partners like Nvidia, AWS, or other tech giants and divide the AI factory development process into phases.
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