Intel has unveiled its intentions to create a separate entity solely focused on advancing its artificial intelligence (AI) software initiatives.
In a strategic move, Intel is set to launch a new company named Articul8 AI (pronounced “Articulate AI”), with support from investors including Digital Bridge Group, a prominent digital-focused asset manager, and other key stakeholders.
The move marks Intel’s strategic decision to seek outside investment for specific business units. This follows a similar pattern seen with the spin-out of Mobileye Global and IPO of its programmable chip unit.
Formation of Intel AI Spin-off Articul8 AI
The forthcoming entity, named Articul8 AI (pronounced “Articulate AI”), is a result of Intel’s collaborative efforts with Boston Consulting Group (BCG) in the realm of corporate AI technology. Originating from Intel’s development of a generative AI system, which can analyze text and images using a combination of internally developed and open-source technology, the company adapted the system to operate within BCG’s data centers. This modification addressed privacy and security concerns raised by BCG.
“We’ve been really trying to address the biggest gap in generative AI today, which is that building a proof of concept is easy, but getting things into production and doing it safely and in a cost sustainable way is really what is missing,”
~Arun Subramaniyan, Upcoming CEO of Articul8 AI
Intel’s CEO, Pat Gelsinger, unveiled these developments during the AI Everywhere event in New York on December 14, 2023. Arun Subramaniyan, formerly the vice president and general manager in Intel’s data center and AI group, is set to take on the role of Chief Executive Officer at Articul8.
Intel Strategic Approach: AI Spin-off
Intel’s decision to form Articul8 reflects its broader strategy of seeking external capital for specific business units. Beyond Digital Bridge, other key investors in Articul8 include Fin Capital, Mindset Ventures, Communitas Capital, GiantLeap Capital, GS Futures, and Zain Group. This approach enables Intel to leverage external expertise and resources while fostering innovation and growth in emerging areas such as AI.
7 Reasons why AI Spin-off by Intel is a good idea
The formation of Articul8 AI by Intel represents a strategic and forward-thinking move for several reasons:
Specialized Focus on AI Software:
- By establishing Articul8 as a dedicated entity for AI software, Intel can concentrate its resources and expertise on advancing this specific aspect of its business. This focused approach allows for more efficient development, innovation, and problem-solving in the rapidly evolving field of artificial intelligence.
External Capital Injection:
- Seeking investment from external partners, including DigitalBridge Group and other notable investors, provides Articul8 with additional financial resources. This injection of capital can be crucial for research and development, hiring top talent, and scaling operation. This ultimately accelerates the company’s growth and market presence.
- The collaboration between Intel and Boston Consulting Group (BCG) that led to the creation of Articul8 demonstrates the value of strategic partnerships. By working with BCG, Intel was able to address specific industry challenges related to privacy and security concerns. This showcases the potential for collaboration in solving complex problems.
Meeting Industry Challenges:
- Articul8 AI targets a crucial challenge in generative AI—facilitating the transition from proof of concept to production safely and cost-effectively. This aligns with the industry’s demand for practical solutions that seamlessly integrate into existing workflows. This aids businesses in overcoming adoption hurdles related to AI technologies.
Independence and Agility:
- Establishing Articul8 as an independent company with its own board of directors allows for greater agility and decision-making autonomy. This independence can facilitate quicker responses to market demands, changes in technology, and evolving customer needs, fostering a more nimble and adaptable organization.
Diversification of Business Units:
- Intel’s strategy of seeking external capital for specific business units, as seen with the spin-out of Mobileye Global and plans for an IPO of its programmable chip unit, indicates a broader effort to diversify its portfolio. This approach helps Intel navigate different market dynamics and capitalize on growth opportunities in distinct technological domains.
Attracting Top Talent:
- The external investment and the establishment of Articul8 as an independent entity can make it an attractive destination for top talent in the AI field. This influx of skilled professionals can further enhance the company’s capabilities. This can help to drive innovation, and contribute to the success of its AI software initiatives.
This strategic move positions Intel as a key player in the evolving landscape of artificial intelligence.
The creation of Articul8 AI represents Intel’s commitment to advancing AI technology and addressing industry challenges. Articul8’s emphasis on transitioning from AI proof of concept to production is poised to accelerate AI adoption across industries. Intel’s pursuit of external capital highlights its commitment to innovation and adaptability in the rapidly evolving tech landscape.