Sam Altman, the CEO of OpenAI, apparently wants to step into the chip manufacturing business and reshape the industry as we know it. Due to rising demands in the semiconductor supply chain, the semiconductor business is expected to grow rapidly as AI applications gain traction. This is why major players have their eyes set on this industry. However, Altman’s ambition comes with a staggering price tag—$7 trillion.
Altman’s Plans May be Far too Ambitious, Even for the Tremendously Lucrative AI Industry
OpenAI needs to reduce its reliance on Microsoft for computing power. Because of this, it needs to explore other avenues to guarantee a sustainable plan. The demand for AI chips is skyrocketing, but there aren’t enough to meet the needs of companies like OpenAI. Altman has proposed investing $5 to $7 trillion to build a wafer foundry, which will help improve global chip-building capacity.
Sources say that Altman is in talks with the United Arab Emirates government and has negotiated with existing semiconductor companies like TSMC to operate the foundry.
The global chip market currently sits at $527 billion, with projections reaching $1 trillion within six years. In response to this growing demand, the US passed the CHIPS Act in 2022, allocating $52.7 billion to bolster domestic chip production.
The scale of this proposal and the implications of its potential returns raise many questions, mainly keeping Sam Altman’s history in the picture. In 2018, he invested in a company called “Rain Neuromorphics” that aimed to make chips capable of emulating the human mind. However, the US government deemed the chips a national risk soon after.
Altman also aimed to develop a company called “Tigris” that sat at the top of the semiconductor food chain, rivaling giants like NVIDIA, which just recently soared to a market cap of $1.8 trillion and is now the leading AI GPU supplier in the world.
While securing a quarter of the U.S.’ GDP might not seem promising, it certainly puts many things into perspective. For instance, if Altman succeeds, he could potentially buy out all the chipmakers and equipment manufacturers with trillions left over—that’s the kind of power $7 trillion holds.
This is all we know for now, but rest assured that we will keep you updated as new information becomes available.