OpenAI’s Sam Altman Seeks Trillions To Overhaul Chip Industry – Report

OpenAI and its CEO Sam Altman is reportedly seeking a major overhaul of the semiconductor industry that could cost trillions of dollars.

The Wall Street Journal (WSJ) reported last week that the OpenAI head has been pursuing investors including the United Arab Emirates (UAE) government for a project possibly requiring as much as $7 trillion.

This project reportedly requires such a huge investment in order to reshape the global semiconductor industry, to overcome current limitations with AI chips.

Trillions of dollars

According to the WSJ, Sam Altman is seeking to raise funds for the wildly ambitious tech initiative that would boost the world’s chip-building capacity, expand its ability to power AI, among other things, and cost several trillion dollars, according to people familiar with the matter.

The project could require raising as much as $5 trillion to $7 trillion, one of the people told the WSJ.

The fundraising plans, which face significant obstacles, are aimed at solving constraints to OpenAI’s growth, including the scarcity of expensive AI chips needed to train large language models behind AI systems such as ChatGPT.

According to the WSJ, Altman has often complained that there isn’t enough of these kinds of graphics-processing units (GPUs) to power OpenAI’s quest for artificial general intelligence, which it defines as systems that are broadly smarter than humans.

High costs

Nvidia of course currently controls about 80 percent of that AI chip market, with a current market cap of about $1.72 trillion.

Last week it was reported that Nvidia is to build bespoke semiconductors and chips for certain customers, as its customers including OpenAI, Microsoft, Alphabet and Meta Platforms, race to snap up the dwindling supply of Nvidia chips.

Nvidia’s H100 and A100 chips serve as a generalised, all-purpose AI processor for many of those major customers, and while Nvidia does not disclose H100 prices, each chip can reportedly sell from $16,000 to $100,000 depending on the volume purchased and other factors.

Meta for example has reportedly said it plans to bring its total stock to 350,000 H100s chips this year, demonstrating the hefty financial investment required to compete in this sector.

The level of investment that Sam Altman is seeking, as much as $7 trillion, would dwarf the current size of the global semiconductor industry, the WSJ noted.

Global sales of chips were $527 billion last year and are expected to rise to $1 trillion annually by 2030, it reported.

Sam Altman

Sam Altman has been the public face of OpenAI since 2019, until his shocking (and brief) ousting as CEO by the non-profit board of directors in November last year.

The board had said that Altman “was not consistently candid in his communications with the board”.

Altman was quickly reinstated after significant pressure from OpenAI investor Microsoft and the threat of mass resignations within OpenAI’s 770 staff.

In the weeks before his shock ousting, multiple reports had stated that Sam Altman had been seeking to raise billions from some of the world’s biggest investors for an AI chip venture.

Altman was also reportedly been looking to raise funds for an AI-focused hardware device he has been developing with former Apple designer Jony Ive.

Middle East

Last month however it was reported that Sam Altman had been courting investors in the Middle East and elsewhere to set up a network of fabrication plants for advanced AI chips.

Bloomberg and other news outlets had reported that the talks with Abu Dhabi-based AI investment group G42 and others were motivated by Altman’s belief that it is necessary to act now to ensure a sufficient supply of AI processing chips through the end of the decade.

In 2018, Altman personally invested in an AI chip startup called Rain Neuromorphics, based near OpenAI’s San Francisco headquarters, and in 2019, OpenAI signed a letter of intent to spend $51 million on Rain’s chips.