Altman plans to raise billions of dollars to establish data centers worldwide, allowing artificial intelligence to flow like electrical utilities.

On Saturday, September 28th, OpenAI CEO Altman is in discussions with UAE investors, Asian chip manufacturers, and American officials to enhance the computing power needed to build artificial intelligence. Altman proposes a joint project worth trillions of dollars to establish new chip factories and data centers globally.

OpenAI trains artificial intelligence models requires a large amount of data, therefore needing support from a large number of AI infrastructure such as data centers. Currently, the AI infrastructure is insufficient, and the electrical power supporting data centers is far from enough. Yesterday, Altman stated at the Italian Technology Week that an unparalleled nuclear fusion energy demonstration will be seen in the coming years. Huang Renxun also mentioned that as a renewable energy, nuclear energy can provide the required power for more and more data centers.

OpenAI has drawn a blueprint for the future of global technology, envisioning the establishment of numerous data centers to provide global computing power reserves for building the next generation of artificial intelligence. Despite some participants and regulatory institutions having reservations about certain plans, negotiations are still ongoing and expanding to Europe and Canada.

This plan may sound too ambitious, with many voices of opposition from the outside.$Taiwan Semiconductor (TSM.US)$Executives directly call building 36 semiconductor factories extremely "absurd", and Japanese officials find it "ridiculous" that a data center requires 5 gigawatts of electricity. However, this also indicates the determination of the technology industry to accelerate development, hoping to ultimately achieve a great transformation like the industrial revolution.

There is a shortage of chips and datacenter supply.

According to Altman's plan, they will build a datacenter in the UAE because the UAE has excess power while the USA has insufficient power. For this plan, OpenAI has discussed infrastructure funding issues with the UAE investment institution MGX set up for artificial intelligence and has also met with Taiwan Semiconductor and Samsung.$NVIDIA (NVDA.US)$and Samsung.

Omar Sultan Al Olama, the UAE Minister of State for Artificial Intelligence, told The New York Times in March during an interview that pursuing such a large deal makes 'business sense'.

OpenAI's ChatGPT and many other AI systems learn skills by analyzing large amounts of numbers and data. However, the chips and datacenter driving this process are currently in short supply, and the electrical utilities supporting datacenter operations are also inadequate. If the supply increases, OpenAI believes they can build more powerful AI systems. In several dozen meetings, OpenAI executives are urging tech companies and investors to enhance global computing capabilities.

Technology research company Futurum Group CEO Daniel Newman said: 'Altman is considering how to keep OpenAI relevant. It needs more computing power, more connectivity, and more energy.'

So, how to solve the problem of chip and datacenter supply shortage?

Altman's original plan was to have the United Arab Emirates fund the construction of multiple semiconductor manufacturing plants, and then have Nvidia use these semiconductors to produce more AI chips. Finally, OpenAI and other companies will use these AI chips to build artificial intelligence datacenters. In Altman's plan, the cost of building each semiconductor manufacturing plant can be as high as $43 billion. However, this plan will reduce the cost of chip companies such as Taiwan Semiconductor in manufacturing chips.

But, running datacenters requires a large amount of electrical utilities, so what should be done?

Altman considered using electricity from Japanese nuclear power plants and explored the feasibility of using offshore wind power generators. Overall, nuclear energy as a renewable energy source is a better choice.

In private conversations, Altman likened global datacenters to electrical utilities. As electricity became widespread, people found better ways to utilize it. Altman hopes to do the same with datacenters, eventually bringing artificial intelligence technology into every household.

Absurd plan?

Altman began fundraising for this project last year and visited the headquarters of Taiwan Semiconductor. Altman told senior executives at Taiwan Semiconductor that building 36 semiconductor factories and additional datacenters to achieve his vision would require $7 trillion and many years.

Senior executives at Taiwan Semiconductor found this idea very absurd because simply adding a few semiconductor manufacturing plants already involves extremely high risks, let alone 36.

Taiwan Semiconductor spokesperson Will Moss stated that the company is willing to discuss expanding semiconductor development, but the company is currently focused on the ongoing global expansion project, and there are "no new investment plans to disclose".

Around the same time, Altman visited South Korea and held meetings with chip manufacturers Samsung and SK Hynix.

This spring, OpenAI held a meeting with Japanese officials in Tokyo. During the meeting, a plan was proposed to utilize retired nuclear power plants after the 2011 Fukushima disaster to generate electricity in order to support the construction of data centers. OpenAI mentioned the need for 5 gigawatts of power, causing a Japanese official to laugh as this is approximately 1000 times the power consumption of a typical data center.

Later, during a meeting with German officials, OpenAI explored the possibility of building a data center in the North Sea to utilize 7 gigawatts of power from offshore wind generators.

"Going overseas" step one: OpenAI decides to first build data centers in the USA.

Clearly, Altman's pursuit of a trillion-dollar investment has encountered obstacles.

Firstly, a trillion dollars is equivalent to a quarter of the annual economic output of the USA, leading many to mock the absurdity. Secondly, American officials are concerned that OpenAI's attempt to build critical technology in the Middle East may pose technical security issues. Finally, to build AI infrastructure in multiple countries, OpenAI needs approval from American officials responsible for export control.

Since then, Altman has scaled down his plan to hundreds of billions of dollars, with OpenAI spokesperson Liz Bourgeois stating: "We have never considered a trillion-dollar project. Although the construction cost of global AI infrastructure may reach hundreds of trillions of dollars over decades, the specific scale OpenAI is exploring is in the hundreds of billions of dollars."

At the same time, OpenAI has devised a new strategy: to first build data centers in the USA to attract American government officials.

OpenAI stated that it focuses on building infrastructure in the United States, with the goal of ensuring the country maintains its global leadership in innovation, promoting nationwide reindustrialization, and ensuring widespread access to the benefits of artificial intelligence.

During a White House meeting with other technology leaders earlier this month, Altman submitted an OpenAI research report titled "Infrastructure is Destiny," calling for the construction of new data centers in the United States. The construction cost for each data center is $100 billion, about 20 times the cost of today's most powerful data center construction. The data centers will accommodate 2 million AI chips and consume 5 gigawatts of power.

OpenAI leaders told White House officials that AI data centers will be a catalyst for America's reindustrialization, creating up to 0.5 million job opportunities.

Last week, at T-Mobile's investor event, Altman modestly mentioned the company's ambitions:

"We are building on a vast foundation of prior work. If you think about all that needs to happen in human history to discover semiconductors, manufacture chips, build networks, and these giant data centers, we've just done our small part at the top of that."

In addition, OpenAI is also attempting to form a loose alliance of companies, including data center developers, investors, and chip manufacturers. However, details such as funding sources, beneficiaries, and the type of infrastructure they will build remain unclear.$Microsoft (MSFT.US)$like these, involved in the construction of data centers, investors, and chip manufacturers. However, details such as funding sources, beneficiaries, and the type of infrastructure they will build remain unclear.

Editor/Rocky