Alibaba to set up dedicated chip subsidiary

Alibaba Group Holding Ltd announced on Wednesday it will establish a dedicated chip subsidiary that aims to create customized artificial intelligence chips and embedded processors to further support the tech giant's sprawling cloud and internet of things businesses.

The company plans to launch its first indigenous AI interference chip - 'AliNPU' - in the second half of 2019, Chief Technology Officer Zhang Jianfeng said at Alibaba's annual cloud computing conference in Hangzhou.

Zhang said the firm has embarked on developing its own quantum processors, and is looking to roll out a genuine quantum chip in two to three years.

"We are confident that our advantages in algorithm, data intelligence, computing power and domain knowledge on the back of Alibaba's diverse ecosystem will put us in a unique position to lead real technology breakthroughs in disruptive areas, such as quantum and chip technology," he said at the conference.

The newly-formed entity is the merger of the chip team from DAMO Academy, Alibaba's in-house technology and science research arm, and microchip maker C-SKY Microsystems Co Ltd, which it acquired in April.

The new company, which is likely to boast 200 to 300 researchers, aims to operate independently in the long run and becomes self-sufficient following initial financial input from Alibaba.