Amazon is reportedly in talks to invest heavily in OpenAI, the company behind ChatGPT. The discussions could lead to one of the largest funding deals in the artificial intelligence sector. A source familiar with the matter confirmed the talks on Tuesday.
According to the source, Amazon may invest around $10 billion in OpenAI. If finalized, the deal could value the AI firm at more than $500 billion. However, the discussions remain at an early stage. The source said the terms are still changing and no final decision has been made.
The potential investment highlights the rising demand for computing power in the AI industry. Companies are racing to develop systems that can match or exceed human intelligence. This has led to massive spending on data centers, chips, and cloud services.
OpenAI has already signed several major agreements this year. Companies such as Nvidia and Oracle have secured multi-billion-dollar deals with the AI firm. In November, OpenAI also signed a $38 billion agreement to purchase cloud services from Amazon.
Despite strong demand, investors are becoming more cautious. Many are watching closely for signs that AI growth could slow. Others are questioning whether the huge investments will deliver expected returns.
The talks between Amazon and OpenAI come as the AI company prepares for a possible public listing. Reuters reported in October that OpenAI could pursue an initial public offering. Such a move could value the company at up to $1 trillion.
The discussions also reflect OpenAI’s growing flexibility in forming partnerships. The company has moved away from its original non-profit structure. It is now a public benefit corporation, controlled by a non-profit entity.
This structure was created after OpenAI finalized its agreement with Microsoft. Microsoft currently owns a 27 percent stake in OpenAI. It also has exclusive rights to sell OpenAI models through its cloud platform.
The new structure has removed earlier limits on fundraising and access to computing resources. This has allowed OpenAI to seek capital from multiple partners.
Media outlet The Information first reported the talks. The report said OpenAI plans to use Amazon’s Trainium chips. These chips compete with products from Nvidia and Google. The report also suggested Amazon’s investment could lead to a wider funding round.
In other related news also read Open AI’s ChatGPT Gets a Massive Upgrade With Web Plugins
OpenAI may also sell an enterprise version of ChatGPT to Amazon. Details on feature integration remain unclear. OpenAI, Amazon, and Microsoft have not commented on the report so far.
