Artificial intelligence is transforming industries and creating vast new fortunes. But behind every chatbot, image generator and AI model is a physical product: a semiconductor chip. We trace the global supply chain powering the AI revolution. From the companies designing the world&#x27;s most advanced chips, to the factories manufacturing them, and the specialist machines needed to produce them, we examine who is profiting from the surge in demand. We also explore why so much of the world&#x27;s most advanced chip production is concentrated in one place, Taiwan, and what that means for the global economy at a time of growing tensions between China and the West. As governments compete for technological leadership and businesses spend billions on AI infrastructure, we ask a simple question: who is getting rich from the AI boom, and what happens if the supply chain breaks? Presenter: Sam Fenwick Producer: David Cann (Photo: Holographic robot arms making semiconductor Credit:Yuichiro Chino / Getty Images)

Follow the money: The chips powering AI

Business Daily

# Full Transcript

**Podcast:** Business Daily

## Transcript

The familiar sound of a computer booting up. You're probably near one right now. A phone in your hand, a laptop open in front of you. Switch it on and somewhere inside a small piece of silicon starts doing sums, billions of them, every second. You've never seen it but it's the reason the thing in front of you works.

And this is that sound scaled up. A room full of machines, rows of them running hot, kept alive by fans that never stop. I'm standing in one right now at the BBC and it's quite cool in here. This is the noise behind the AI boom, behind every answer from ChatGPT, every image, every model that runs on chips, tens of thousands of them.

I'm Sam Fenwick and this is Business Daily from the BBC World Service. The chip industry is one of the fastest growing on Earth. This year it's heading for a trillion dollars in sales. So today we're following the money from the company that designs the chip, to the factory that builds it, to the one machine that makes it possible and the island the whole thing depends on.

This is the chip inside the AI boom. Who's getting rich off it and who's paying the bill? AI seems to be everywhere at the moment, from designing new medicines to forecasting the weather and driving autonomous cars. What it seems capable of is mind blowing. You might think of it as software, something that lives on a screen, a chat bot, an app, an answer that appears out of nowhere.

But every one of those applications runs on a chip, a piece of silicon that you can hold in your hand. And the chip doing all the hard work started life running video games. Follow that chip and you follow the money behind AI. So let's start at the top of the chain with the company whose name you've probably heard of already. Nvidia, the most valuable company on Earth right now. But here's the strange part.

Nvidia doesn't own a single factory that makes its chips. It designs them for someone else to build. Carl Freund is the founder of Cambrian AI Research, an independent firm whose clients, like many in the sector, include Nvidia. He spent years inside the industry at companies like AMD. So what does Nvidia actually do? Nvidia designs chips.

They design CPUs, they design networking chips, and they, of course, are most famous for designing graphics processing units, GPUs, which used to be used for gaming applications and now are primarily used for artificial intelligence. Nvidia doesn't want to be a manufacturer of chips. That's a completely different business than designing chips. It's very capital intensive. So Nvidia is the architect. It draws the chip.

People call Nvidia the toll booth for AI, the idea being that you have to go through them to get there. They definitely have control of the main road. Why? Because you can probably get your AI model up and running faster using Nvidia than anything else. The software is widely available. Most software built run specifically on Nvidia and t...

Follow the money: The chips powering AI

Transcript

Built for investment professionals

Every day you wait, your competitors are finding
edge in conversations you're not hearing.

Follow the money: The chips powering AI

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.