OpenAI's Circular Deals with Nvidia and AMD Raise Concerns About AI Boom Sustainability
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Summary
OpenAI has entered into major partnerships with both Nvidia and AMD, involving massive investments and chip deployment commitments. Nvidia agreed to invest up to $100 billion in OpenAI for data-center expansion, while OpenAI committed to using millions of Nvidia chips. Similarly, OpenAI partnered with AMD to deploy tens of billions of dollars worth of AMD chips. These interconnected deals have raised concerns about the sustainability of the $1 trillion AI boom being propped up by circular business arrangements.
Key quotes
· 4 pulledNvidia Corp. agreed to invest as much as $100 billion in OpenAI to help the leading AI startup fund a data-center buildout so massive it could power a major city.
OpenAI in turn committed to filling those sites with millions of Nvidia chips.
The arrangement was promptly criticized for its 'circular' nature.
OpenAI struck a similar deal with Nvidia rival Advanced Micro Devices Inc. to deploy tens of billions of dollars' worth of its chips.
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