Amazon is reportedly in talks to invest $10 billion in OpenAI as circular deals remain popular | TechCrunch

Amazon is in early talks to invest as much as $10 billion in OpenAI in a deal that would see the AI ​​lab use the e-commerce giant’s AI chips. CNBC reported.

If it materializes, the deal would value OpenAI at more than $500 billion, according to Bloomberg reportedciting an anonymous source.

Amazon has sought to diversify its bets in the AI ​​race, so far partnering and investing $8 billion in Anthropic, a rival to OpenAI. The e-commerce giant also unveiled the latest version of its product earlier this month Trainium chip seriesand outlined the development of the next installment of those chips, complementing its cloud computing offering through Amazon Web Services.

News of the deal comes a few months after OpenAI completed its transition to a for-profit model, giving it more freedom to make deals with investors other than Microsoft, one of the company’s early backers with a 27% stake.

Amazon’s investment in OpenAI would be the latest in a series of circular deals in the AI ​​space: major hardware manufacturers and cloud providers are making deals with young AI companies to use their products, while the newcomers commit to using their data centers and chips to train their AI models.

Last March, OpenAI invested $350 million of stock in CoreWeave, which used the money to buy chips from its backer Nvidia. The same chips provide computing power to OpenAI, which increases CoreWeave’s revenue and ultimately makes OpenAI’s deployment more valuable. Then in October, OpenAI signed a deal to acquire a 10% stake in AMD and committed to using the chipmaker’s AI GPUs, and also signed a chip usage agreement with Broadcom that month. And in November, the ChatGPT creator signed a $38 billion cloud computing deal with Amazon.

OpenAI and Amazon did not immediately respond to requests for comment.