openAI is becoming the single point of failure of this bubble . Who DOESN't have a deal with them
That's by design of course.
Rising tide lifts all boats.
AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
161–170 of 390 posts
Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#162I wonder what we will do with all that compute if no one is going to use it...even if we achieve AGI it won't run on this generation of hardware. Are we just gonna brute force architectures or wtf is going on?
I assume there's at least one generation of re-sale value. There's a lot of smaller companies that could use GPU capacity and would if it was cheaper. I wonder how the math works out though -- are power requirements such that the actual costs aren't worth it? How long before the chips just get thrown away?
Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#163Earlier quoted context omitted.
What is AMD getting that's worth giving OpenAI $100B? Sure, they're giving it from other stockholders not from their pocket, but still. It's presumably a lot of value, there has to be a good reason, no? Is it that Sam promises to somehow make AMD increase their market cap, or help at least?
> What is AMD getting that's worth giving OpenAI $100B? The other $300B
Where is this other $300B coming from? Is OpenAI paying AMD $400B or what? I looked at the article but it seems disjointed and hard to parse for me. And I don't see where it mentions some $400B coming to AMD one way or another. It's implied... how?
Sorry, this isn't sarcasm or anything like it. I just don't get it and your answer does not help.
Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#164Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#165Earlier quoted context omitted.
I think at least part of the 10% is if AMD stock reaches 600. Not that I disagree that this looks weird. Why was that needed to be offered? Couldn't they just buy the AMD chips if they're good enough? Or Nvidia is it's better? I also don't get why there commiting so much to the future, are they sure of the quality of the products and their demand that much?
>Couldn't they just buy the AMD chips if they're good enough? OpenAI would presumably need to raise money to buy the AMD chips. The "genius" of this deal is that AMD is "giving away" 10% of the company (at $0.01/share) to OpenAI. Then OpenAI will presumably turn around and sell those shares (or borrow against them) to raise enough money to purchase the AMD GPUs.
> The "genius" of this deal is that AMD is "giving away" 10% of the company (at $0.01/share) to OpenAI.
There's no giving away of anything in the deal. The $0.01 per share price is only available if they purchase the GPUs.
It's more like one of those "free with purchase" deals where you're still paying for the product, but they throw in something to sweeten the deal.
They're not actually getting AMD shares at $0.01 each with no strings attached like many of the comments are assuming.
Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#166This industry is the most intense game of musical chairs I've seen in a long time.
i grew up thinking finance was boring. after 2008, i started to pay a bit of attention, but the last few years of financial shenanigans have been absolute cinema, it feels like we are approaching the season finale.
Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#167The title didn't make this obvious (at least not to me) but it's OpenAI that has the option to buy 10% of AMD. Not the other way around. In case you're wondering how OpenAI could afford to buy 10% of AMD while they are hemorrhaging money -- the terms of the deal allows OpenAI to buy 160 million shares at 1 cents a share. I could be thinking about this the wrong way but it appears that AMD is basically subsidizing the…
AMD is giving OpenAI warrants (cf options) to buy AMD shares at 1c/share, but these only vest if OpenAI goes thru with AMD purchases as intended. It seems to basically give OpenAI an incentive to go thru with the deal.
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Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#168The title didn't make this obvious (at least not to me) but it's OpenAI that has the option to buy 10% of AMD. Not the other way around. In case you're wondering how OpenAI could afford to buy 10% of AMD while they are hemorrhaging money -- the terms of the deal allows OpenAI to buy 160 million shares at 1 cents a share. I could be thinking about this the wrong way but it appears that AMD is basically subsidizing the…
> In case you're wondering how OpenAI could afford to buy 10% of AMD while they are hemorrhaging money -- the terms of the deal allows OpenAI to buy 160 million shares at 1 cents a share.
Ha ha, OpenAI can afford this because your mom uses a grand total of 7 pieces of software owned by 5 companies, 4 are the largest public companies in the world, and the 5th one is OpenAI.
Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#169Feels like we're living through a Michael Lewis book. OpenAI estimate that it takes around $50bn to stand up a 1GW datacenter. This deal is 6GW worth of chips. Their projected revenues out to YE-2029 are $300bn. OpenAI will spend a decades worth of revenues building & filling the datacenters to house these chips, before accounting for their AI research, training, or inference spend.
Don't forget that OpenAI also has a similarly-massive deal with Oracle and another one with Nvidia. And its own Stargate initiative. And probably a couple more massive contracts with neoclouds to use more stuff. Like best possible scenario is OpenAI merely optioning from literally everybody because they don't think they have a shot at getting any capacity otherwise. There is just no possible way that they can actuall…
if you buy all the chips, no one else can build agi. sama probably
Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake
#170Two years ago, I built my entire business exclusively on AMD on the bet that one day they would wake up to AI and dive head on into it. They were totally behind on NVIDIA and my feeling was that Lisa Su would not be able to ignore what was coming. This news far exceeds my expectations for how quickly things are changing. Feeling pretty good now.