OpenAI CEO Sam Altman Seeks $7 Trillion To Change The Face Of Chip Manufacturing: Report

OpenAI CEO Sam Altman Seeks $7 Trillion To Change The Face Of Chip Manufacturing: Report
Sam Altman attends the annual Allen & Company Sun Valley Conference | Getty Images | Photo by Drew Angerer

OpenAI CEO Sam Altman is reportedly in talks with investors to raise trillions of dollars for an ambitious project aimed at boosting the production of semiconductors needed to run advanced artificial intelligence programs. Citing people familiar with the matter, the Wall Street Journal reported that Altman’s endeavors to transform global chip manufacturing could cost in the ballpark of $5 trillion to $7 trillion. The report added that Altman is in talks with investors, including the government of the United Arab Emirates.

The WSJ quoted an OpenAI spokesperson as saying that the company has had “productive discussions about increasing global infrastructure and supply chains” and more details will be shared at a later date.

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As per the report, Altman in his pitch has proposed building dozens of chip foundries to boost production. These would then be run by existing chip makers, like the Taiwan Semiconductor Manufacturing Company (TSMC).



 

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Altman aims to solve challenges in the way of OpenAI’s growth, including a scarcity of chips that power its AI models such as ChatGPT. Further, Altaman has held meetings with senior UAE officials, TSMC executives, US Secretary of Commerce Gina Raimondo, and SoftBank’s chief executive Masayoshi Son to discuss his plans, according to the report.

Microsoft is said to be aware of Altman’s plans and is supportive of the project, according to a New York Post report. Altman has reportedly looped in Microsoft CEO Satya Nadella and chief technology officer Kevin Scott about the ambitious project.

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The US Congress has also taken various measures, like passing the CHIPS and Science Act, to boost domestic computer chip production to reduce the country’s reliance on China.

Altman had complained about the lack of powerful chips known as graphics-processing units, or GPUs to power OpenAI’s quest for artificial general intelligence, which it defines as systems broadly smarter than humans.



 

However, the WSJ described the sums being sought as “outlandishly large by the standards of corporate fundraising”. An investment in the sum of trillions of dollars would dwarf the current size of the global semiconductor industry.



 

While numerous countries have announced plans to support semiconductor production, the global supply is still dominated by a handful of firms, such as the Taiwan Semiconductor Manufacturing Company (TSMC) and California-based NVIDIA.



 

This year, the Semiconductor Industry Association (SIA) has forecast a 13.1% jump in global chip sales to $595.3 billion, compared with a drop of about 8% in sales in 2023, according to a Foxbusiness report.

Further, the global sales of chips were $527 billion last year and are expected to rise to $1 trillion annually by 2030. The global sales of semiconductor manufacturing equipment, last year were $100 billion, and are expected to reach $124 billion in 2025, according to an estimate by the industry group SEMI.

Altman has raised investments toward his endeavors in chip manufacturing. Right after Altman’s ouster as the CEO of OpenAI in November last year, he was reportedly seeking billions for a new and not-yet-formed chip venture code-named “Tigris” to compete with Nvidia. At the time he had even traveled to the Middle East to raise money from investors for the project, CNBC reported.



 

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

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