> OpenAI considered building everything in-house and raising capital for an expensive plan to build a network of factories known as "foundries" for chip manufacturing. The company has dropped the ambitious foundry plans for now due to the costs and time needed to build a network
That framing massively undersells how insane Sams ambitions were there, he was floating the idea of somehow raising seven trillion dollars to build thirty six fabs dedicated to making AI silicon. The TSMC execs reported more or less laughed in his face when he brought it up it them.
Google, Apple, and Microsoft together don't even spend $100B on CapEx per year. And they're worth almost $10T put together.
Asking for $7T when you're a $100B company is so ridiculous it's beyond belief.
wheels 2 hours ago [-]
And if it was a 30% stake in OpenAI for that $7 trillion (kind of a standard VC round percentage) that would put OpenAI's valuation at about the same of all of the 7000-ish NASDAQ companies (including almost all public tech companies) combined.
lumost 1 hours ago [-]
There was probably a point of maximum hype ~12 months ago, or right after the launch of GPT-4 where the belief of imminent singularity was running high.
And most of that is part of Gross Fixed Capital Formation already...
dgfitz 5 minutes ago [-]
It’s funny how that bit only comes up when HN wants to use it to make a point.
cedws 19 minutes ago [-]
Yeah, I mean, what else would you do with those chips? Run LLMs faster? Sorry but the killer app is still not there, the majority of people do not care and have no use for them.
colechristensen 2 hours ago [-]
>What's the military budget of USA?
Somewhere between $900B and $1T this year
sroussey 1 hours ago [-]
Does anyone have a source for this “$7T” number?
I read it on the internet myself with “sources saying” but I think it’s BS.
It's kind of admirable, though. If you start asking for $7T, only asking for $1T becomes quite reasonable ;-)
latexr 56 minutes ago [-]
That only works if the initial request isn’t so bonkers that no one can trust subsequent ones.
cal5k 9 minutes ago [-]
True. I think Sam might get a "bonkers" pass because of his track record that the rest of us might not.
1 hours ago [-]
lyu07282 1 hours ago [-]
Only if they stop laughing long enough for them to hear your second offer
bronco21016 19 minutes ago [-]
> The TSMC execs reported more or less laughed in his face when he brought it up it them.
Reminds me of:
Musk flew there with Cantrell, prepared to purchase three ICBMs for $21 million. But to Musk's disappointment, the Russians now claimed that they wanted $21 million for each rocket, and then taunted the future SpaceX founder. As Cantrell recounted to Esquire: “They said, 'Oh, little boy, you don't have the money?”
bravetraveler 18 minutes ago [-]
Maybe I'm just jaded, but I think even one deserves a laugh. Design, sure. Fabrication? Hah.
xyst 2 hours ago [-]
It’s just 1/5th of the current USA national debt of $35T, bro. Just have fed run those money printers 365/24/7.
a13n 2 hours ago [-]
It could have been strategy instead of insanity. By starting conversations at $7T you anchor high and potentially drive a greater outcome than starting an order of magnitude lower.
rurp 1 hours ago [-]
That strategy only works if the anchor is in the realm of reality. If I'm selling a 20 year old Toyota Corolla and initially ask for $900,000 that's not going to help me get a higher price.
jsheard 2 hours ago [-]
Usually when doing anchoring you want to end up at a result less than what you originally asked for but crucially more than zero, and OpenAI immediately folded on building any fabs whatsoever, so I don't think it worked.
adventured 2 hours ago [-]
When you do something that stupid - starting at $7 trillion - you end the conversation before it really begins because you lose all credibility with the people that matter (eg TSMC and other investors).
If he had said $250 billion and six fabs, it would have been a lot to ask but people wouldn't think he was ignorant or irrational for saying it. Big tech for example has that kind of money to throw around spread out across a decade if the investment is a truly great opportunity.
onlyrealcuzzo 1 hours ago [-]
Asking for $7T is - seriously - only slightly more absurd than asking for infinity dollars.
lyu07282 50 minutes ago [-]
I guess he thinks his glorified markov chain will lead to ASI if scaled up sufficiently. Even if we get ASI, the likelihood that anybody will ever make any money from it is so delusional. This isn't going to be your average brainwashed peasant, crushing these capitalist pigs is probably the first thing it's gonna do.
GaggiX 43 minutes ago [-]
This comment honestly feels delusional.
jordanb 35 minutes ago [-]
And to think Satya Nadella looked at this guy and his plan and said "this is the kind of stable genius we need running OpenAI."
cedws 17 minutes ago [-]
Or he’s the perfect guy to give MS freedom to dig their claws in.
ForHackernews 57 minutes ago [-]
Approaching Adam Neumann-levels of grandiosity.
Could it be possible that OpenAI's new autocomplete will be as transformative to the global economy as WeWork's short term office rentals?
Cthulhu_ 52 minutes ago [-]
And that's 7T just to build the fabs, then they'd need tons more money to build the hardware to put the chips in, datacenters, staff, software, etc.
kkielhofner 2 hours ago [-]
For reference seven trillion dollars is 25% of US GDP.
Yeah, that's um, wild.
1 hours ago [-]
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shreezus 2 hours ago [-]
[flagged]
snovv_crash 2 hours ago [-]
$7T can buy a hell of a lot of human intelligence. At that price I'm not sure AS/GI is cost competitive.
bboygravity 1 hours ago [-]
You think summoning machine god would not be cost competitive? God as in smarter than all of humanity combined times infinity (or at least a very large number).
Earning back the 7T with god/satan on your side could be trivial and at the same time the least of your worries for other reasons (maybe god doesn't like you and/or doesn't care about you).
talldayo 11 minutes ago [-]
> God as in smarter than all of humanity combined times infinity (or at least a very large number).
This is delusional. Nobody has demonstrated AI that can even match the output that human creativity has accomplished in the past 5 years. It will take an awful long time before it's up there alongside humans, and by the time it surpasses us we'll both be long dead.
If you're not just being performative for a joke here, then I don't even know how I can explain how wrong you are. All of this - the promises of "AGI", the bajillion-dollar meme order sent to TSMC, the cryptic sama tweets in lowercase - it's performance art. It's unsubstantiated, nondilineated, unproven, unstudied nonsense. That's it. I'm sorry if I hurt your feelings, the crypto bros had to go through this a few months ago and it was tough for them too. But the dividends have to be paid, and in a few years time your "$7 trillion dollar" intellectual property empire will be sand.
nobunaga 1 hours ago [-]
Some people (like yourselves) are so delusional that you are capable of considering wasting 7T$ on something that is a glorified autocomplete technology. We kind of a need a reset in the tech industry to get rid of mindsets like yours. AGI is still so far away and when the AI bubble eventually bursts, you will probably still try to convince yourself it still only needs 7T$. The state of people in the tech industry is sad.
meiraleal 56 minutes ago [-]
> Some people (like yourselves) are so delusional that you are capable of considering wasting 7T$ on something that is a glorified autocomplete technology.
You know that to many, you are the delusional one if you think that some fictional number in a screen is more important than this glorified autocomplete technology that has the potential to revolutionize humanity as much as agriculture, electricity and the internet.
atleastoptimal 31 minutes ago [-]
If you don't believe ASI is possible, 7T is way too high. If you believe ASI is possible, 7T is wayyy too low, thus 7T is a compromise if you believe there's a non-certain chance of ASI being possible
cedws 12 minutes ago [-]
How do you even define ASI? How do you know it will run on silicon? If it will run on silicon, what kind of silicon? GPU? TPU? Binary? Ternary? Von-Neumann architecture? How can you even start to build chips for something completely imaginary?
camjw 26 minutes ago [-]
Surely this “logic” applies to every positive amount of dollars. Why not 700T
latchkey 2 hours ago [-]
"while adding AMD (AMD.O), opens new tab chips alongside Nvidia (NVDA.O), opens new tab chips to meet its surging infrastructure demands"
Jensen has been saying that demand is "insane" and we're hearing rumors of low yields. This equates to supply issues in the coming months/years. No fortune 500 puts all their eggs into one basket. Diversifying away from a single source for all of AI hardware and software, is a smart thing to do.
vineyardmike 2 hours ago [-]
> Diversifying away from a single source for all of AI hardware and software, is a smart thing to do.
I wonder how this squares with the exclusivity contract with Microsoft. Even the OpenAI/Oracle deal requires Oracle to run Azure stack on their datacenter so MSFT can mediate the relationship. The AMD chips mentioned are also purchased by MSFT.
I wonder if this really means that OpenAI is accepting the risk/capital expense while providing a variety of hardware to Microsoft, or if there are other terms at play.
That is exactly what the execs at my company are telling us when asked about not using Nvidia -- diversifying away. It's funny though because we have no Nvidia for training at all. We use Trainium because we could not get our hands on Nvidia.
latchkey 38 minutes ago [-]
I'm guessing you also got some free/discounted credits?
Not sure of the pricing, but the performance of their chip is pretty outdated at this point. MI300x is way faster and more memory.
fuddle 2 hours ago [-]
How long would take them to get a new chip into production and then used for training/inference?
wmf 1 hours ago [-]
The first generation chip won't be good enough to use in production so then you have the second generation... maybe 3-4 years.
KaiserPro 46 minutes ago [-]
twoish years, if you're good. Then the software to make it work properly. its not a quick thing to do.
You can throw more money at it to make it go faster, but it also might fuck it up and take longer.
qubitly 2 hours ago [-]
Spending $7 trillion on in-house fabs sounded both ambitious and crazy. Reality finally kicked in. If they’re done dreaming big, let’s hope they keep the quality
whaleofatw2022 3 hours ago [-]
I feel like them working with broadcom is another warning sign
Broadcom also builds xPUs for Google, Meta and Bytedance. Maybe these companies know a thing or two.
plegresl 3 hours ago [-]
Why? Google also partners with Broadcom for TPU.
mgh2 3 hours ago [-]
Why? Care for references instead of opinions?
ZeroCool2u 3 hours ago [-]
I'm not saying that I necessarily agree, but the general consensus on HN seems to be that Broadcom is now less of a tech company and more of a holding company that raids others, for example VMWare, and extracts all value to the detriment of customers and the acquired company.
I don't think that's completely wrong, but it's a big company and I'm sure there are some better areas of the company than others.
wmf 2 hours ago [-]
Broadcom has some really good chips and their semi-custom chip business is pretty successful. HN doesn't understand hardware so they don't know this.
alephnerd 2 hours ago [-]
[flagged]
razodactyl 2 hours ago [-]
I think the internet changed all over.
It's a sign that we're moving on to greener pastures.
Sucks for the new generation that think everything needs an app to work.
The internet was better at feeling less corporate a decade ago.
nsteel 1 hours ago [-]
I think it's completely wrong in the context of its role as an ASIC partner. There's a very short list of companies with all the IP needed for these cutting-edge ASICs and Broadcom/Avago might be the best of them. And to be clear, they've developed that IP themselves, just as they've always done. Those that think they're just a "holding company" haven't actually worked with them.
lokar 33 minutes ago [-]
It’s confusing. The PE buyout built a holding/looting company and owned Broadcom, and took the Broadcom name.
So both are correct. Broadcom is a legit important hw company, and it is a PE holding company that buys and loots tech companies (like VMware)
blibble 2 hours ago [-]
it's no longer Broadcom
Avago Technologies (owned by corporate raiders) bought Broadcom, then took its name for itself
its ticker is still AVAG
1 hours ago [-]
alephnerd 3 hours ago [-]
> general consensus on HN
General consensus on HN is generally wrong.
onion2k 2 hours ago [-]
General consensus on HN is generally wrong.
I think everyone here would agree with that.
;)
hatthew 2 hours ago [-]
this makes sense since the general consensus on HN is that any general consensus on HN is right so if the general consensus on HN that any general consensus on HN is right is wrong then any general consensus on HN could be wrong
OrigamiPastrami 2 hours ago [-]
Is there somewhere the general consensus is generally right?
Workaccount2 2 hours ago [-]
"Journalists" seem to trust twitter an awful lot...
formerly_proven 2 hours ago [-]
Broadcom is on track to spend 10bn on RND this year. Basically a pure-play patent troll!
sroussey 1 hours ago [-]
Don’t they make the WiFi chips in iPhones?
0x0203 2 hours ago [-]
Additionally, having worked with some of their network devices at the driver level, they seem to be kludge piled on top of hack poured over a soup of workarounds for hardware bugs. Maybe they've gotten better recently, but just looking at their drivers, it didn't paint a great picture.
sroussey 1 hours ago [-]
Oh god, I’d paint all hardware companies that way!
Having been on both sides, I’m continually shocked that stuff even works.
observationist 3 hours ago [-]
Sam seems to be finding as many devils to bargain with as he can; Broadcom is a particularly devilish company.
crowcroft 3 hours ago [-]
Makes sense to work with them if they’re trying to design some kind of ASIC that would work for training or inference though?
worldsayshi 3 hours ago [-]
What have they done?
nick__m 2 hours ago [-]
They buy companies like VMWare and Computer-Associate, gut them and jack the price until they only have captive consumers from the fortune 500.
alephnerd 2 hours ago [-]
CA and VMWare were already dead on acquisition.
Splunk+Datadog and AWS+Nutanix+Cohesity respectively ate much of CA and VMWare's marketshare.
2 hours ago [-]
3 hours ago [-]
high_na_euv 2 hours ago [-]
So TSMC will eventually work with podcasting bro
>TSMC execs allegedly dismissed Sam Altman as ‘podcasting bro’ — OpenAI CEO made absurd requests for 36 fabs for $7 trillion
CryptoBanker 2 hours ago [-]
I’m sure they’ll work with anyone willing to pay
Rendered at 23:35:19 GMT+0000 (Coordinated Universal Time) with Vercel.
That framing massively undersells how insane Sams ambitions were there, he was floating the idea of somehow raising seven trillion dollars to build thirty six fabs dedicated to making AI silicon. The TSMC execs reported more or less laughed in his face when he brought it up it them.
You don't just acquire $7T.
The ENTIRE US domestic Net Investment isn't even $1T: https://fred.stlouisfed.org/series/W790RC1Q027SBEA
Gross Fixed Capital Formation (Net Investment + Deprecation) isn't much more: https://fred.stlouisfed.org/series/NFIRSAXDCUSQ
Google, Apple, and Microsoft together don't even spend $100B on CapEx per year. And they're worth almost $10T put together.
Asking for $7T when you're a $100B company is so ridiculous it's beyond belief.
https://en.wikipedia.org/wiki/Universal_Paperclips
And even them it would have to be split during a decade or two. And even then.
What's the military budget of USA?
Most of it is spent on personnel and operation.
You'd want to know only what the procurement is - which is ~$146B: https://en.wikipedia.org/wiki/Military_budget_of_the_United_...
And most of that is part of Gross Fixed Capital Formation already...
Somewhere between $900B and $1T this year
I read it on the internet myself with “sources saying” but I think it’s BS.
https://www.tomshardware.com/tech-industry/tsmc-execs-allege...
Reminds me of:
Musk flew there with Cantrell, prepared to purchase three ICBMs for $21 million. But to Musk's disappointment, the Russians now claimed that they wanted $21 million for each rocket, and then taunted the future SpaceX founder. As Cantrell recounted to Esquire: “They said, 'Oh, little boy, you don't have the money?”
If he had said $250 billion and six fabs, it would have been a lot to ask but people wouldn't think he was ignorant or irrational for saying it. Big tech for example has that kind of money to throw around spread out across a decade if the investment is a truly great opportunity.
Could it be possible that OpenAI's new autocomplete will be as transformative to the global economy as WeWork's short term office rentals?
Yeah, that's um, wild.
Earning back the 7T with god/satan on your side could be trivial and at the same time the least of your worries for other reasons (maybe god doesn't like you and/or doesn't care about you).
This is delusional. Nobody has demonstrated AI that can even match the output that human creativity has accomplished in the past 5 years. It will take an awful long time before it's up there alongside humans, and by the time it surpasses us we'll both be long dead.
If you're not just being performative for a joke here, then I don't even know how I can explain how wrong you are. All of this - the promises of "AGI", the bajillion-dollar meme order sent to TSMC, the cryptic sama tweets in lowercase - it's performance art. It's unsubstantiated, nondilineated, unproven, unstudied nonsense. That's it. I'm sorry if I hurt your feelings, the crypto bros had to go through this a few months ago and it was tough for them too. But the dividends have to be paid, and in a few years time your "$7 trillion dollar" intellectual property empire will be sand.
You know that to many, you are the delusional one if you think that some fictional number in a screen is more important than this glorified autocomplete technology that has the potential to revolutionize humanity as much as agriculture, electricity and the internet.
I wonder how this squares with the exclusivity contract with Microsoft. Even the OpenAI/Oracle deal requires Oracle to run Azure stack on their datacenter so MSFT can mediate the relationship. The AMD chips mentioned are also purchased by MSFT.
I wonder if this really means that OpenAI is accepting the risk/capital expense while providing a variety of hardware to Microsoft, or if there are other terms at play.
https://www.amd.com/en/newsroom/press-releases/2024-5-21-amd...
Not sure of the pricing, but the performance of their chip is pretty outdated at this point. MI300x is way faster and more memory.
You can throw more money at it to make it go faster, but it also might fuck it up and take longer.
I don't think that's completely wrong, but it's a big company and I'm sure there are some better areas of the company than others.
It's a sign that we're moving on to greener pastures.
Sucks for the new generation that think everything needs an app to work.
The internet was better at feeling less corporate a decade ago.
So both are correct. Broadcom is a legit important hw company, and it is a PE holding company that buys and loots tech companies (like VMware)
Avago Technologies (owned by corporate raiders) bought Broadcom, then took its name for itself
its ticker is still AVAG
General consensus on HN is generally wrong.
I think everyone here would agree with that.
;)
Having been on both sides, I’m continually shocked that stuff even works.
Splunk+Datadog and AWS+Nutanix+Cohesity respectively ate much of CA and VMWare's marketshare.
>TSMC execs allegedly dismissed Sam Altman as ‘podcasting bro’ — OpenAI CEO made absurd requests for 36 fabs for $7 trillion