OpenAI has signed a deal to purchase $38 billion worth of capacity. Amazon Web services, first deal with cloud infrastructure leader, and latest sign that $500 billion artificial intelligence startup is no longer dependent on it. microsoft.
Under the agreement announced Monday, OpenAI will immediately begin running workloads on AWS infrastructure, with hundreds of thousands of Nvidia’s The US is introducing graphics processing units (GPUs) and plans to increase capacity over the next few years.
Amazon stock rose about 5% on the news.
The first phase of the deal will use existing AWS data centers, and Amazon plans to eventually build additional infrastructure for OpenAI.
“What we’re trying to reduce is a whole other set of capacity,” Dave Brown, vice president of compute and machine learning services at AWS, said in an interview. “Some of that capacity is already available, and OpenAI is leveraging it.”
OpenAI has been active in trading recently, including NVIDIA, broadcom, oracle and google This has led skeptics to warn of an AI bubble and question whether the country has the power and resources needed to make its ambitious promises a reality.
OpenAI had an exclusive cloud agreement with Microsoft until this year, but Microsoft first backed the company in 2019, investing a total of $13 billion. Microsoft announced in January that it would no longer be OpenAI’s exclusive cloud provider, moving to an arrangement in which it would have the right of first refusal on new requests.
Last week, priority status expired under new commercial terms Microsoft negotiated with OpenAI, allowing ChatGPT creators to partner more broadly with other hyperscalers. Even before that, OpenAI had signed a cloud deal with Oracle, googleHowever, AWS is by far the market leader.
“Scaling frontier AI requires large-scale, reliable computing,” OpenAI CEO Sam Altman said in a release Monday. “Our partnership with AWS strengthens the broader computing ecosystem that powers this next era and brings advanced AI to everyone.”
OpenAI plans to continue to invest heavily in Microsoft, reaffirming its commitment last week by announcing it would buy $250 billion in additional Azure services.
For Amazon, the deal is significant, both in terms of the size and scale of the deal itself, and because of the cloud giant’s close ties to OpenAI rival Anthropic. Amazon has invested billions of dollars in Anthropic and is currently building an $11 billion data center campus in New Carlisle, Indiana, designed specifically for Anthropic workloads.
“The breadth and immediate availability of optimized compute shows why AWS is uniquely positioned to support OpenAI’s vast AI workloads,” AWS CEO Matt Garman said in the release.
Amazon reported in its earnings call last week that AWS revenue increased more than 20% year over year, beating analyst expectations. However, growth was faster for Microsoft and Google, which reported cloud expansion of 40% and 34%, respectively.
Start with Nvidia
The current deal with OpenAI is explicitly aimed at using Nvidia chips, including two popular Blackwell models, but could include additional silicon in the future. Amazon’s custom-built Trainium chips are being used by Anthropic in the new facility.
“We like Trainium because it offers better value for money and allows us to honestly offer choice to our customers,” Brown said, adding that he could not provide details about “what we have done with OpenAI on Trainium at this time.”
This infrastructure supports both inference, such as enhancing ChatGPT’s real-time responses, and training next-generation frontier models. OpenAI can scale using AWS as needed for the next seven years, but plans beyond 2026 have not yet been determined.
OpenAI CEO Sam Altman (left) shakes hands with Kevin Scott, Microsoft’s chief technology officer and vice president of artificial intelligence, during the Microsoft Build conference at the Seattle Convention Center Summit Building on May 21, 2024 in Seattle, Washington, USA.
Jason Redmond | AFP | Getty Images
OpenAI’s underlying model, including the so-called open weight option, is already available on Bedrock, AWS’s managed service for accessing leading AI systems.
Companies including peloton, Thomson Reuters, comscoreTriomics uses OpenAI models on AWS for a variety of tasks, from coding and mathematical problem solving to scientific analysis and agent workflows.
Monday’s announcement establishes a more direct relationship.
“As part of this agreement, OpenAI will become an AWS customer,” Brown said. “They commit to buying computing power from us, and we charge OpenAI for that power. It’s very simple.”
For OpenAI, one of the most highly regarded private AI companies, the deal with AWS is another step toward preparing to eventually go public. OpenAI is demonstrating both independence and operational maturity by diversifying its cloud partners and securing long-term capacity across providers.
Altman acknowledged in a recent livestream that an IPO is the “most likely path” given OpenAI’s funding needs. CFO Sarah Friar echoed that sentiment, calling the company’s recent restructuring a necessary step toward going public.
Featured: AWS CEO Matt Garman talks about Amazon’s massive new AI data center for Anthropic
