Key Takeaways
- OpenAI and Amazon have signed a deal that would see the AI business paying the web service company $38 billion.
- The deal provides OpenAI with more computing power, which it direly needs to power its AI model.
- OpenAI has entered into several deals over the last few months to accomplish its lofty AI goals.
Another day, another OpenAI partnership, with the company of ChatGPT fame signing yet another deal to further advance its AI model, this time with Amazon.
OpenAI has run a full-on partnership gauntlet over the last few months, signing deals left and right with companies that can help it achieve the lofty AI goals set out by CEO Sam Altman.
Now, Amazon is joining the fray by providing computing power to OpenAI in exchange for $38 billion.
OpenAI Partners With Amazon for Computing Power
Announced on Monday, OpenAI has agreed to pay Amazon $38 billion over the next seven years in exchange for the company’s expansive cloud computing services.
The deal will give OpenAI access to “hundreds of thousands” of AI chips from NVIDIA, which are currently being used to power the Amazon Web Services (AWS) system for the company.
This just in! View
the top business tech deals for 2025 👨💻
Previously, OpenAI had an exclusive partnership with Microsoft to provide all of its computing power. However, that deal was renegotiated last week, opening the door for the AI company to explore other opportunities without their approval.
Why Is Amazon Partnering With OpenAI?
$38 billion is a lot of money, which begs the question. Why is OpenAI paying Amazon so much money for its computing power? Well, the answer is pretty obvious if you’ve been following the AI company over the last few months.
“Scaling frontier AI requires massive, reliable compute. Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone.” – Sam Altman, CEO of OpenAI
In so many words, OpenAI needs more power to make its lofty AI goals a reality, and the only way to do that is with the vast computing infrastructure that is provided by Amazon and the AWS platform.
OpenAI and Its Many Deals
This deal with Amazon is far from the first big partnership that OpenAI has entered over the last few months. In fact, $38 billion isn’t even that much compared to the cumulative $1 trillion (with a T) that the company has doled out to bolster its AI offering.
OpenAI entered into a deal with chipmaker NVIDIA to the tune of $100 billion, and also announced a partnership with chipmaker AMD, although the amount was not disclosed for that one. Beyond that, OpenAI has also signed a deal with Google in June, Oracle in September, and Broadcom earlier this month.
Yes, many have speculated that these deals are proof of an AI bubble, given that money keeps bouncing back and forth between a select few AI companies. But given the demands of AI technology on our infrastructure, it could just mean that OpenAI is trying to position itself as the only company prepared to take the next step.
