OpenAI and Amazon.com Inc have signed a US$38 billion deal that enables the ChatGPT maker to run its artificial intelligence (AI) systems on Amazon’s data centers in the US.
OpenAI would be able to power its AI tools using “hundreds of thousands” of Nvidia Corp’s specialized AI chips through Amazon Web Services (AWS) as part of the deal announced on Monday.
The agreement comes less than a week after OpenAI altered its partnership with its longtime backer Microsoft Corp, which until early this year was the start-up’s exclusive cloud computing provider.
Photo: Reuters
California and Delaware regulators also last week allowed San Francisco-based OpenAI, which was founded as a nonprofit, to move forward on its plan to form a new business structure to more easily raise capital and make a profit.
“The rapid advancement of AI technology has created unprecedented demand for computing power,” Amazon said in a statement on Monday.
It said OpenAI “will immediately start utilizing AWS compute as part of this partnership, with all capacity targeted to be deployed before the end of 2026, and the ability to expand further into 2027 and beyond.”
AI requires huge amounts of energy and computing power, and OpenAI has long signaled that it needs more capacity to develop new AI systems and keep existing products such as ChatGPT answering the questions of its hundreds of millions of users. It has recently made more than US$1 trillion worth of financial obligations in spending for AI infrastructure, including data center projects with Oracle Corp and Softbank Group Corp and semiconductor supply deals with chipmakers Nvidia, Advanced Micro Devices Inc and Broadcom Inc.
Some of the deals have raised investor concerns about their “circular” nature, since OpenAI does not make a profit and cannot yet afford to pay for the infrastructure that its cloud backers are providing on the expectations of future returns on their investments.
OpenAI CEO Sam Altman last week dismissed doubters he says have aired “breathless concern” about the deals.
“Revenue is growing steeply. We are taking a forward bet that it’s going to continue to grow,” Altman said on a podcast where he appeared with Microsoft CEO Satya Nadella.
Amazon is already the primary cloud provider to AI start-up Anthropic PBC, an OpenAI rival that makes the Claude chatbot.
RUN IT BACK: A succesful first project working with hyperscalers to design chips encouraged MediaTek to start a second project, aiming to hit stride in 2028 MediaTek Inc (聯發科), the world’s biggest smartphone chip supplier, yesterday said it is engaging a second hyperscaler to help design artificial intelligence (AI) accelerators used in data centers following a similar project expected to generate revenue streams soon. The first AI accelerator project is to bring in US$1 billion revenue next year and several billion US dollars more in 2027, MediaTek chief executive officer Rick Tsai (蔡力行) told a virtual investor conference yesterday. The second AI accelerator project is expected to contribute to revenue beginning in 2028, Tsai said. MediaTek yesterday raised its revenue forecast for the global AI accelerator used
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has secured three construction permits for its plan to build a state-of-the-art A14 wafer fab in Taichung, and is likely to start construction soon, the Central Taiwan Science Park Bureau said yesterday. Speaking with CNA, Wang Chun-chieh (王俊傑), deputy director general of the science park bureau, said the world’s largest contract chipmaker has received three construction permits — one to build a fab to roll out sophisticated chips, another to build a central utility plant to provide water and electricity for the facility and the other to build three office buildings. With the three permits, TSMC
TEMPORARY TRUCE: China has made concessions to ease rare earth trade controls, among others, while Washington holds fire on a 100% tariff on all Chinese goods China is effectively suspending implementation of additional export controls on rare earth metals and terminating investigations targeting US companies in the semiconductor supply chain, the White House announced. The White House on Saturday issued a fact sheet outlining some details of the trade pact agreed to earlier in the week by US President Donald Trump and Chinese President Xi Jinping (習近平) that aimed to ease tensions between the world’s two largest economies. Under the deal, China is to issue general licenses valid for exports of rare earths, gallium, germanium, antimony and graphite “for the benefit of US end users and their suppliers
Dutch chipmaker Nexperia BV’s China unit yesterday said that it had established sufficient inventories of finished goods and works-in-progress, and that its supply chain remained secure and stable after its parent halted wafer supplies. The Dutch company suspended supplies of wafers to its Chinese assembly plant a week ago, calling it “a direct consequence of the local management’s recent failure to comply with the agreed contractual payment terms,” Reuters reported on Friday last week. Its China unit called Nexperia’s suspension “unilateral” and “extremely irresponsible,” adding that the Dutch parent’s claim about contractual payment was “misleading and highly deceptive,” according to a statement
RSS