In an effort to reshape the global AI chip industry, OpenAI CEO Sam Altman is reportedly in talks with investors to raise between $5 trillion and $7 trillion.
According to The Wall Street JournalTThe ambitious fundraising effort, if successful, would surpass the combined value of AMD, Nvidia and Intel, and aims to address the current scarcity of graphics processing units (GPUs) essential for operating major language models such as ChatGPT, Microsoft Copilot and Google Gemini.
The proposed fundraising amount is indicative of the significant capital required to establish new semiconductor manufacturing capabilities. Altman would propose a partnership between OpenAI, investors, chip manufacturers and energy suppliers to jointly finance the construction of chip foundries, which will be operated by existing chip makers. OpenAI is expected to be a major customer of these new factories.
Meeting demand
Altman’s ambitious goals exceed the current global sales of the entire semiconductor industry, which is $527 billion.
Potential investors include sovereign wealth funds, government agencies, especially the United Arab Emirates (UAE), SoftBank CEO Masayoshi Son, and representatives of Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest dedicated independent semiconductor foundry.
This move is intended to significantly increase global semiconductor manufacturing capacity to meet the increasing demand for GPUs and other AI-specific chips.
However, the involvement of the UAE, led by Sheikh Tahnoun bin Zayed al Nahyan, a key security official and chairman of numerous state investment vehicles in Abu Dhabi, could raise geopolitical concerns, especially regarding the US government’s strategic priorities in the area of semiconductor and AI manufacturing. development.
The US has been cautious about foreign control over the supply of microchips because of their importance to the digital economy and national security. Reflecting this, the Biden administration has made efforts to boost domestic chip production through subsidies and regulatory oversight of foreign investments in critical technologies.
To put the proposed estimate of $5 trillion to $7 trillion into context: Ars Technica points out that the White House recently announced a $5 billion investment in R&D to advance U.S.-made semiconductor technologies. TSMC has already invested $40 billion in a US chip factory in Arizona, representing one of the largest foreign investments in US history. At this time, it remains uncertain whether Altman has made any commitments to his fundraising goal.