OpenAI CEO Sam Altman, who has been working to raise billions of dollars from global investors for a chip venture, aims to use the funds to set up a network of factories to manufacture semiconductors, several sources with knowledge of the plans said.
Altman has had conversations with several large potential investors in the hopes of raising the vast sums needed for chip fabs, they said.
Firms that have held discussions with Altman include Abu Dhabi-based G42, sources told Bloomberg last month, with another named firm being Softbank Group Corp, some of them added.
Photo: AFP
The project would involve working with top chip manufacturers, and the network of fabs would be global in scope, they said.
While efforts to raise funds for a chip venture were earlier reported by Bloomberg, the scope of the project and the focus on manufacturing were not previously known. The talks are still early and a full list of involved partners and funders has not been established, the sources said.
Altman’s fundraising push reflects his concern that as artificial intelligence (AI) becomes more pervasive, there would not be enough chips for widespread deployment, some of the sources said. Some current forecasts for the production of AI-related chips fall short of projected demand.
Building and maintaining fabs that manufacture semiconductors is far more expensive than the approach favored by many of OpenAI’s industry peers. Amazon.com Inc, Alphabet Inc’s Google and Microsoft Corp — OpenAI’s largest investor — typically focus on designing their own custom silicon and then farm out manufacturing to outside companies.
Constructing a single state-of-the-art fab could require tens of billions of dollars, and creating a network of such facilities would take years. The talks with G42 alone had focused on raising US$8 billion to US$10 billion, sources told Bloomberg previously, although the status of the discussions remains unclear.
Altman believes the industry needs to act now to ensure that there is sufficient supply near the end of the decade, sources familiar with his thinking said.
Since OpenAI released ChatGPT more than a year ago, interest in AI applications has skyrocketed among companies and consumers. That in turn has spurred massive demand for the computing power and processors needed to build and run those AI programs. Altman has said repeatedly that there are not enough chips for his company’s needs.
Intel Corp, Taiwan Semiconductor Manufacturing Co (台積電) and Samsung Electronics Co lead the chip fabrication market and are potential partners for OpenAI.
Altman had been hard at work on the chips project until he was temporarily ousted as OpenAI CEO in November last year. Upon his return, he rekindled the efforts. Altman has also sounded out Microsoft on the plan, and the software giant is interested, two sources said.
Meanwhile, G42 has been the subject of calls this month by a key US lawmaker for greater scrutiny and trade restrictions.
US House China Select Committee Chairman Mike Gallagher, a Republican from Wisconsin, raised concerns about G42’s relationships with blacklisted Chinese companies including Huawei Technologies Co (華為) and Beijing Genomics Institute, as well as risks to research at US universities. Gallagher urged US Secretary of Commerce Gina Raimondo to consider sanctions on G42 and 13 of its subsidiaries and affiliates.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday obtained the government’s approval to inject an additional US$7.5 billion into its US subsidiary, the Department of Investment Review said in a statement. The department approved TSMC’s application of investing in TSMC Arizona Corp, which is engaged in the manufacturing, sales, testing and design of IC and other semiconductor devices, it said. The latest capital injection follows a US$5 billion investment for TSMC Arizona approved in June. The chipmaker has broken ground on two advanced fabs in Arizona with aggregated investments approved by the department totaling US$24 billion thus far. According to TSMC, the first Arizona
The lethal hack of Hezbollah’s Asian-branded pagers and walkie-talkies has sparked an intense search for the devices’ path, revealing a murky market for older technologies where buyers might have few assurances about what they are getting. While supply chains and distribution channels for higher-margin and newer products are tightly managed, that is not the case for older electronics from Asia where counterfeiting, surplus inventories and complex contract manufacturing deals can sometimes make it impossible to identify the source of a product, analysts and consultants say. The response from the companies at the center of the booby-trapped gadgets that killed 37
FRIENDLY TAKEOVER: While Qualcomm Inc’s proposal to buy some or all of Intel raises the prospect of other competitors, Broadcom Inc is staying on the sidelines Qualcomm Inc has approached Intel Corp to discuss a potential acquisition of the struggling chipmaker, people with knowledge of the matter said, raising the prospect of one of the biggest-ever merger and acquisition deals. California-based Qualcomm proposed a friendly takeover for Intel in recent days, said the sources, who asked not to be identified discussing confidential information. The proposal is for all of the chipmaker, although Qualcomm has not ruled out buying some parts of Intel and selling off others. It is uncertain whether the initial approach would lead to an agreement and any deal is likely to come under close antitrust scrutiny
SECURITY CONCERNS: The proposed ban on Chinese autonomous vehicle software and hardware would go into effect with the 2027 and 2030 model years respectively The US Department of Commerce today is expected to propose prohibiting Chinese software and hardware in connected and autonomous vehicles on US roads due to national security concerns, two sources said. US President Joe Biden’s administration has raised concerns about the collection of data by Chinese companies on US drivers and infrastructure as well as the potential foreign manipulation of vehicles connected to the Internet and navigation systems. The proposed regulation would ban the import and sale of vehicles from China with key communications or automated driving system software or hardware, said the two sources, who declined to be identified because the