Yes. Back in 1989, Intel built one of the first custom chips for ML (ETANN). Since then, there have been hundreds of such designs, and dozens of working chips. So, people have been building them long before "deep learning" arrived in all its glory. Now that it did, it was expected that efforts in custom hardware should intensify.
However, such initiatives still face the same problems as 30 years ago: custom hardware is expensive, inflexible, hard to program, and quickly becomes obsolete. It's still worth it if there's no other way to speed things up, but Moore's law is still alive and kicking, as evidenced by 15B transistor GP100 chip form Nvidia, so we can still just wait a little bit for the next gen GPUs.
Google is certainly in a good position, having developed a very popular ML framework, and having enough resources to develop good hardware (the blog post was written by Norm Jouppi - one of the best computer architects in history). It remains to be seen, however, how well these TPUs are supported in TensorFlow. What kind of models will get the advertised speed up?