Amazon's Israeli chip acquisition pays off handsomely

Avigdor Willenz Credit: Eyal Toueg
Avigdor Willenz Credit: Eyal Toueg

The Graviton server chip developed by Annapurna labs, bought by Amazon in 2015, produces $5 billion in annual revenue, "The Information" reports.

Seven years ago Amazon made its first acquisition in Israel when it bought Yokneam-based Annapurna Labs, which develops chips for servers, for $370 million.

According to a report in "The Information" Amazon did a good deal with Amazon Web Services (AWS) revenue from the Graviton server chip, developed under the leadership of Avigdor Willenz and Ronen Boneh, amounting to $5 billion annually, nearly 10% of AWS's annual revenue from cloud services.

Six AWS customers told "The Information" that the cloud servers based on the chips developed in Israel consume less power and deliver higher speeds and improve computer costs by between 10% and 40% compared with rival chips from Intel and AMD. This relative advantage has helped AWS distinguish itself from the cloud services of Microsoft and Google and present more efficient and cheaper services that allow customers to run AI and machine learning applications much more easily.

US enterprise software company Databricks, for example, uses the Graviton servers for data storage of its operating systems in the company's data warehouses in a process called ETL. Twitter makes use of the Graviton chips in its servers for presenting personal and dynamic feeds for users while Starburst uses the chip for its queries product, which allows customers to search for and quickly locate information in its data and storage bank.

The Graviton chip was developed in Haifa and since 2018 three versions have been released. Like most5 chips developed independently by end-user companies like Apple and Microsoft, AWS's chips are based on ARM architecture, which rivals Intel and Taiwanese giant TSMC. AWS's cloud rivals Microsoft and Google have also developed ARM architecture chips for their servers, with some of these activities conducted in Israel.

Published by Globes, Israel business news - - on July 19 2022.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.

Avigdor Willenz Credit: Eyal Toueg
Avigdor Willenz Credit: Eyal Toueg
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