In a bid to address the escalating global semiconductor shortage, Sam Altman, Chief Executive Officer of OpenAI, is reportedly in advanced talks with major global investors to secure substantial funds for an audacious chip venture.
According to insider sources cited by Fortune, Altman envisions the creation of a comprehensive network of semiconductor manufacturing plants, colloquially known as fabs, signaling a departure from the prevalent industry trend.
Among the potential investors engaged in discussions with Altman are Abu Dhabi-based G42 and SoftBank Group Corp. Bloomberg had previously reported on Altman’s fundraising efforts, but the specific emphasis on manufacturing and the expansive scope of the project was not previously disclosed.
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The talks, still in their nascent stages, aim to forge collaborations with leading chip manufacturers, propelling the establishment of a global network of fabs to meet the surging demand for semiconductors.
The sources indicate that discussions with G42, a prominent player in artificial intelligence, revolved around raising an impressive $8 billion to $10 billion for this visionary project. However, the full list of partners and funders remains undisclosed, and the current status of these discussions remains fluid.
Altman’s aggressive push for fundraising stems from his concerns that the widespread adoption of artificial intelligence (AI) could outpace chip production, leading to a severe shortage.
The proliferation of AI applications among companies and consumers has sparked an unprecedented demand for computing power and processors, prompting Altman to stress the urgency of tackling the imminent semiconductor shortage.
In a departure from the strategies of industry peers like Amazon, Google, and Microsoft — OpenAI’s primary investor — who typically design custom silicon and outsource manufacturing, Altman’s approach involves not only designing but also constructing and maintaining fabs.
The construction of a single state-of-the-art fabrication plant can entail costs in the tens of billions, and creating a global network of such facilities is a colossal undertaking that could span several years.
Altman, who briefly stepped down as OpenAI CEO in November before returning, has revitalized efforts on the chip project, noting the need for immediate industry action to ensure an adequate chip supply by the end of the decade.
The scale and financial commitment of Altman’s vision underscore the severity of the semiconductor shortage and the complexities associated with meeting the growing demand for AI-related chips. Reports suggest Altman has approached Microsoft about the plan, with the software giant expressing interest.
As discussions progress and the chip venture takes shape, stakeholders in the tech industry, investors, and consumers are closely monitoring how the development will impact semiconductor manufacturing and supply.
Key players involved, including OpenAI, G42, Intel, Microsoft, SoftBank, and TSMC, have opted not to comment on the matter. Notably, Samsung officials were not immediately available for comment.
Additionally, the ongoing scrutiny of G42 by US lawmakers introduces another layer of complexity to this ambitious project, raising questions about potential geopolitical implications and trade restrictions. US lawmaker, Mike Gallagher, the House China Select Committee Chairman, has urged Commerce Secretary Gina Raimondo to consider sanctions on G42 and 13 of its subsidiaries and affiliates, due to their ties with blacklisted Chinese companies including Huawei Technologies.
The unfolding narrative of Altman’s chip venture holds the promise of influencing the future trajectory of the semiconductor industry on a global scale.