Apple has explored a major new business venture that would see it offer cloud computing services powered by its own custom chips, pitting it directly against tech giants like Amazon, Microsoft, and Google, according to a recent report from The Information.

The project, discussed internally over the past few years, would allow the millions of developers on Apple's platforms to run workloads on server infrastructure powered by highly efficient Apple silicon. According to three people involved in the effort cited by the report, Apple executives believe the performance and efficiency of their chips could offer a cost advantage to developers, especially for intensive AI applications.

The effort reportedly grew out of an internal project codenamed "ACDC," short for Apple Chips in Data Centers. Apple has already been testing its own chips for internal cloud services, including Apple Wallet transactions, Photos, and Apple Music, seeing both cost savings and performance improvements. As a first step, the company launched Private Cloud Compute last year, which uses Mac chips in its data centers to handle complex Apple Intelligence tasks that can't run on a user's device.

While Apple has faced some public struggles with its broader AI strategy, its custom chips have been a standout success. The company reportedly feels its silicon offers a particular edge for AI inference—the process of using trained AI models to interpret new data. This is a different focus from the massive, power-hungry training process, for which Apple has largely rented chips from Amazon and Google. As AI services mature, inference is expected to become a larger part of the computing workload, and Apple sees an opportunity.

A new cloud service could also bolster Apple's services revenue at a time when its App Store business model faces significant legal and regulatory challenges, including a recent U.S. court ruling that banned the company from taking commissions on web purchases. The report suggests Apple would leverage its existing developer relations team to manage the service, rather than building a traditional enterprise sales force.

Still, the project's future is uncertain. A key proponent, cloud executive Michael Abbott, left the company in 2023. While discussions were reportedly still active in the first half of 2024, it's not clear if they have continued. Apple declined to comment on the matter.