OpenAI in talks to raise US$10 billion from Amazon and adopt Trainium chips
The deal is under discussion could value OpenAI upwards of US$500 billion, a source said
OpenAI is in initial discussions to raise at least US$10 billion from Amazon.com and use its chips, a potential win for the online retailer’s effort to broaden its AI industry presence and compete with Nvidia.
The deal under discussion could value OpenAI north of US$500 billion and see it adopt Amazon’s Trainium chip, a person with knowledge of the matter said, asking to remain anonymous to describe private negotiations. Talks, however, are at a preliminary stage and terms could change, the person added.
A deal would mark a win for Amazon’s fledgling semiconductor division. While Nvidia dominates the market for the powerful chips required to create AI platforms, developers such as Meta Platforms are starting to explore rival offerings from the likes of Alphabet’s Google.
The Trainium chip is a key element of Amazon’s strategy to stand out in AI, complementing its cloud division. Amazon Web Services is the largest seller of rented computing power and data storage, but it has struggled to replicate that dominance among AI developers given intense competition from the likes of Microsoft, one of OpenAI’s largest backers.
Amazon hopes to entice companies looking for a bargain. Trainium chips are capable of powering the intensive calculations behind AI models more cheaply and efficiently than Nvidia’s market-leading graphics processing units, according to the company.
The negotiations between OpenAI and Amazon began around October after the ChatGPT creator completed a corporate overhaul, the Information reported earlier. Microsoft took a 27 per cent ownership stake as part of a restructuring plan that took nearly a year to negotiate.