Amazon.com Inc has revealed it’s intention to invest in about $10 billion in OpenAI.
Amazon may also invest in ChatGPT-maker OpenAI in a potential deal that could value the artificial intelligence firm at more than $500 billion.
Although the talks between the two firms are very fluid, a source said on condition of anonymity because the matter is private.
The potential deal highlights the AI sector’s relentless demand for computing power as companies race to build systems rivaling or surpassing human intelligence.
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Firms such as Nvidia(NVDA.O) have signed AI deals worth several billion dollars with OpenAI this year. OpenAI also signed a $38-billion-deal to buy cloud services from Amazon in November.
However, investors are on guard for signals that demand for AI is tailing off or that the massive spending is not paying off as anticipated.
The discussion between Amazon and OpenAI come at a time when the AI giant is laying the groundwork for an initial public offering that could value the company at up to $1 trillion.
The approach underlines OpenAI’s ability to partner widely after moving on from its non-profit roots and settling its deal with Microsoft (MSFT.O), opens new tab, the source said.
The Microsoft deal makes OpenAI a public benefit corporation that is controlled by a non-profit with a stake in OpenAI’s financial success, removing major constraints on the firm’s ability to raise capital and secure computing resources.
Microsoft holds a 27% stake in OpenAI and has secured an exclusive right to sell OpenAI models to its cloud customers.
Reuters/Wumi