Amazon could follow in Apple's footsteps by building its own processors — here's what that means for future Kindles and Fire TVs

With AI causing skyrocketing production and data costs across the industry, Amazon could be taking the Apple route of bringing processor design in-house in an attempt to save money.The leak comes from supply chain analyst Ming-Chi Kuo who claims that Amazon is "moving away from externally sourced processors and adopting a COT (customer-owned model)." According to Kuo, this decision was made because of the rapid expansion of AI compute and Amazon is responding by streamlining and changing things in its "non-AI businesses."

(Image credit: Erin Bashford)Part of that is a gradual shift away from external sourcing and taking control of processor development. Kuo says that Amazon is tapping AIchip for back-end design and testing with this strategy starting in earnest in 2027.AIchip is 23 year old companny based out of Taipei, Taiwan that designs silicon for other companies, specifically application-specific integrated cricuit (ASIC) chips. In general, these chips are designed, as the name implies for very specific functions. In recent years AIchip has developed 3nm chips used in AI servers for customers that include Amazon and Intel, per Taipei Times.Kuo claims that silicon designed by AIchip could appear in Amazon's devices, including the Kindle, Fire TV, Echo, Blink, Ring and Alexa-enabled products.Why it matters