[Insights] OpenAI CEO’s Ambition to Build Semiconductor Plant Grows Stronger

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In late December 2023, reports surfaced indicating OpenAI CEO Sam Altman’s intention to raise funds to construct a semiconductor plant, ensuring a secure supply of AI chips.

According to a report from the Washington Post on January 24, 2024, Sam Altman has engaged with US congressional members to discuss the construction of the semiconductor plant, including considerations of timing and location, highlighting his increasingly fervent ambition to establish the facility.

TrendForce’s Insights:

• Rising AI Computing Demands Heighten Sam Altman’s Concerns About Chip Supply

The rapid emergence of AI-generated content (AIGC) undoubtedly stood out as a highlight of 2023, closely tied to the quality and efficiency of the large language models (LLMs) used. Take OpenAI’s ChatGPT, for instance, which employs the GPT-3.5 model released in 2020. With 175 billion training parameters, it surpasses its predecessor, GPT-2, by over 100 times, itself being over 10 times larger than the initial GPT from 2018.

In pursuit of better content quality, diversified outputs, and enhanced efficiency, the continuous expansion of model training parameters becomes an inevitable trend. While efforts are made to develop lightweight versions of language models for terminal devices, the cloud-based AI computing arena anticipates a continued expansion of language model training parameters, moving towards the “trillion” scale.

Due to the limited growth rate of AI chip performance, coping with the rapidly increasing model training parameters and the vast amount of data generated by the flourishing development of cloud-based AIGC applications inevitably requires relying on more AI chips. This situation continues to exert pressure on the chip supply chain.

Given that the demand for AI computing is escalating faster than the growth rate of chip performance and capacity, it’s understandable why Sam Altman is concerned about chip supply.

• Sam Altman to Seek Collaboration with Foundries for Plant Construction Goal

The construction of advanced process fabs is immensely costly, with estimates suggesting that the construction cost of a single 3nm fab could amount to billions of dollars. Even if Sam Altman manages to raise sufficient funds for plant construction, there remains a lack of advanced semiconductor process and packaging technology, not to mention capacity, yield, and operational efficiency.

Therefore, it is anticipated that Sam Altman will continue to seek collaboration with sfoundries to achieve his factory construction goal.

Looking at foundries worldwide, TSMC is undoubtedly the preferred partner. After all, TSMC not only holds a leading position in advanced processes and packaging technologies but also boasts the most extensive experience in producing customized AI chips.

While Samsung and Intel are also suitable partners from a localization perspective, considering factors like production schedules and yield rates, choosing TSMC appears to be more cost-effective.

(Photo credit: OpenAI)