OpenAI is seeking a more stable supply of artificial intelligence chips, and a startup owned by OpenAI CEO Sam Altman is expected to become a key supplier after NVIDIA.
According to multiple technology media reports, OpenAI signed a non-binding letter of intent with chip developer Rain AI in 2019. After the launch of Rain’s chips, OpenAI will spend $51 million to purchase their products.
Altman provided seed funding to Rain in 2018, and it was revealed that Altman’s investment has exceeded $1 million.
In addition to Altman, investors in Rain include Saudi Aramco’s Prosperity 7. However, due to mandatory regulations imposed by the US government recently, Prosperity 7 has divested its stake in Rain. In early 2022, Rain announced that Prosperity 7 led a financing round of $25 million.
Investor documents state that Rain may provide its first batch of chips to customers as early as October next year. Earlier this year, Rain also stated that they expect the key process for chip development – tape-out testing – to take place as soon as December.
A more preferred AI chip
The chip being developed by Rain is called Neural Processing Unit (NPU), inspired by the structure of the human brain. According to the company, this chip will require less power than commonly used NVIDIA GPU chips in the industry and allow real-time customization or fine-tuning of artificial intelligence models based on surrounding environments.
Insiders say these features are highly attractive for OpenAI. They hope to reduce costs at data centers and deploy their models on devices such as smartphones and smartwatches.
Currently, OpenAI uses Microsoft’s cloud services through its main investor for providing AI services but has had to close access during periods of high traffic due to hardware limitations.
OpenAI’s focus on Rain chips somewhat highlights the chip dilemma faced by the AI industry. Altman himself has complained about the supply shortage and enticing profits in the field of artificial intelligence chips.
Furthermore, the Rain transaction also reflects the binding relationship between OpenAI and Altman’s investment company. In previous power struggles within OpenAI, one speculation for Altman’s ousting from his position was related to his personal investments.
Some believe that Altman blurred the boundaries between his role as CEO of OpenAI and his personal investment business, which led the OpenAI board to question his integrity. Insiders also support this analysis, stating that Altman’s energy is too scattered, causing dissatisfaction among the OpenAI board.