OpenAI Teams Up With Amazon for Even More Computing Power

Sam Altman is still sore about the $45,000 he spent on a Tesla Roadster but never received, a grievance he aired during his never-ending feud with Elon Musk on X. But that hasn’t kept Altman from spending big at his company OpenAI, which is causally tossing around astronomically larger sums, like the $38 billion it agreed to pay Amazon yesterday for additional cloud infrastructure. 

The new agreement lets OpenAI immediately start tapping the computing power of Amazon Web Services and its hundreds of thousands of advanced Nvidia chips. Amazon is expected to expand its infrastructure to meet the needs of 800 million weekly ChatGPT users asking the chatbot to complete important tasks, like creating recipes based on pics of their nearly empty fridges.

Going Up, Up, Up

OpenAI’s $38 billion deal with Amazon is small potatoes compared to some of its other agreements. Altogether, its tie-ups with companies including Broadcom, Oracle and Google tally up to about $1.4 trillion. OpenAI is reportedly buying $300 billion worth of computing power from Oracle over five years, and last week, the ChatGPT-maker said it’ll scoop up $250 billion worth of Microsoft’s Azure cloud infrastructure. 

The last 18 months have signaled a major shift in how OpenAI makes and spends its money:

• Until 2023, OpenAI only bought power to run its models from Microsoft as part of an exclusive partnership. But as ChatGPT became everyone’s favorite therapist, OpenAI said it needed more power and Microsoft gave the go-ahead for deals with select other companies.  
• Then last week, OpenAI restructured from a “nonprofit” to a “for-profit benefit company” and renegotiated its deal with Microsoft. Now, OpenAI doesn’t need Microsoft’s approval to work with other cloud providers. Hence, its $38 billion deal with Amazon. 

Hot Seat: Circling back to the Altman-Musk beef, Musk on Saturday replied to Altman, “You stole a nonprofit.” Musk sued OpenAI and its founders last spring, alleging they had betrayed the company’s original nonprofit mission. Other critics are simply concerned that the newly for-profit OpenAI could have a hard time making a profit as it continues to burn billions. But Altman said yesterday that OpenAI was making “well more than” the $13 billion annual estimate the Financial Times reported earlier this month and shut down revenue questions with a firm “enough.”