Sam Altman says people are right to be worried about the size of OpenAI’s new expansion, but he isn’t backing down from it.
Speaking from a construction site in Abilene, Texas, where OpenAI is building its first mega data center, the CEO told reporters on Tuesday that the $850 billion infrastructure rollout is necessary. “People are worried. I totally get that,” Sam said. “We are growing faster than any business I’ve ever heard of before.”
As Cryptopolitan reported, OpenAI is now committed to building data centers powered by 17 gigawatts of energy, roughly the same output as 17 nuclear plants or nine Hoover Dams. The electricity load alone could power more than 13 million U.S. homes.
Each site costs about $50 billion, and in total the buildout is almost half of the global $2 trillion AI infrastructure push forecasted by HSBC. Sam explained that the scale is just a response to a huge spike in demand. Over the last 18 months, ChatGPT usage has jumped 10x.
To handle it, Sam said OpenAI needs an entire network of supercomputing sites. “This is what it takes to deliver AI,” he said. “Unlike earlier versions of the internet, this requires massive infrastructure. And this is only a fraction of it.”
Partners lock in funding, power, and leadership to meet AI demand
The biggest issue isn’t money or chips, according to Sam, but power. “Electricity is the constraint,” he said. He led a $500 million funding round for Helion Energy, a fusion firm building a test reactor, and also helped take fission startup Oklo public through his own SPAC.
Not everyone’s convinced. Critics say the whole setup smells like a bubble. Companies tied to OpenAI, like Nvidia, Oracle, Microsoft, and Broadcom, have seen trillions in value added. Nvidia and Microsoft alone are now worth $8.1 trillion, which is 13.5% of the S&P 500.
Skeptics also say the model looks circular. OpenAI is throwing money at projects run by its partners, who then fund and supply the same projects, making money off chip sales and leasing data centers back to OpenAI.
But Sarah Friar, OpenAI’s CFO, dismissed that argument. “Folks like Oracle are putting their balance sheets to work,” she said on-site. Oracle is leasing the Texas facility. Nvidia is contributing both chips and equity, including its Vera Rubin accelerators for future AI workloads. OpenAI will pay to run the sites once they’re live, while Nvidia gets paid as their chips are used.
Sarah said the goal is to bring new capacity online next year, but the team is also planning for what gets built in 2027, 2028, and 2029. She said there’s a massive shortage of compute, and OpenAI needs to build now to avoid getting stuck later.
OpenAI’s partners shift roles as devices enter the picture
Oracle is already switching up its leadership to focus on AI. On Monday, it named Clay Magouyrk and Mike Sicilia as co-CEOs, replacing Safra Catz. Clay was running cloud infrastructure, and Mike led Oracle Industries. Clay told CNBC, “I only see more and more demand from the end users … what looks like near infinite demand for technology.”
Sarah also talked about OpenAI’s close ties with Microsoft. “They’re a major partner,” she said. She hinted at new developments but said they’re “not fully ready to announce everything yet.”
There’s also hardware in the pipeline. In May, OpenAI acquired Jony Ive’s new device startup for $6.4 billion. Sam said the idea is to build computers that don’t just process commands, but actually “understand and think.” The first batch of hardware will be limited. “A small family of devices,” he said. But he added, “the potential is something big.”
When asked about an IPO, Sam kept it vague. “I assume that someday we will be a public company,” he said. “I have mixed feelings about it.” He noted that public markets force companies to focus on short-term earnings, which could get in the way of long-term planning. But he also said, “I think that the world should, if people want to, own shares in OpenAI. I think that’s awesome, and I want that to happen.”
Your crypto news deserves attention – KEY Difference Wire puts you on 250+ top sites
Source: https://www.cryptopolitan.com/sam-altman-on-concerns-over-openai-expansion/
