Hyperscalers are quietly ending their dependence on legacy graphics processing unit (GPU) makers by aggressively migrating to building their own chips. For years, the major cloud providers operated essentially as toll collectors. They bought commercial GPUs off the shelf at a premium and rented out that compute power to enterprise clients.
That dynamic is breaking down rapidly. Cloud giants recognize that relying on third-party designers for foundational hardware creates unacceptable margin compression. The physical economy of AI infrastructure is shifting away from off-the-shelf components toward proprietary systems that cloud providers control end-to-end.
