"But there's something very worrying about many of these deals: they're often "circular," as a slew of recent coverage has noted, meaning that AI companies are pouring money into one another, creating an illusion of a robust ecosystem that skeptics worry could quickly come crashing down. And many of the deals tie back to Nvidia, the chipmaker whose hardware is underpinning our age of AI, for which it has become the world's most valuable company."
"One recent example is Nvidia's agreement to invest up to $100 billion in OpenAI, as the ChatGPT maker expands its empire of data centers that will demand enough energy to power millions of homes. As part of that deal, announced two weeks ago, OpenAI will in return use Nvidia's chips to fill out its AI facilities. OpenAI announced it had reached a staggering deal with Oracle, the Larry Ellison-led software giant, to buy $300 billion worth of its cloud computing power."
Multibillion-dollar AI deals between major tech companies are increasingly circular, with firms effectively pouring money into one another and creating an illusion of a robust ecosystem. Many of these agreements tie back to Nvidia, whose chips underpin current AI infrastructure and have driven its market value to the top. Examples include Nvidia's proposed up to $100 billion investment in OpenAI in exchange for chip usage, Oracle's $300 billion cloud commitment tied to Nvidia-powered services and chip purchases, and AMD's offer of computing capacity to OpenAI coupled with a ten percent stake for one cent per share. Experts warn such inter-industry dealing could signal an unstable bubble and raise questions about long-term sustainability and energy demands.
Read at Futurism
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