Compute is the New Oil
“Compute is the new oil,” said Jonathan Ross, founder of Groq, in a recent interview with Matthew Berman, echoing Sam Altman’s thought. OpenAI chief is pretty much determined to solve the energy and compute issues associated with building and providing generative AI services to a large customer base. “Compute is going to be the currency of the future. It will maybe be the most precious commodity in the world. And we should be investing heavily to make a lot more compute,” said Altman in a recent interview with Lex Fridman. At the same time, Altman believes that it is the hardest problem to solve. The challenges include computing, energy supply, data centre construction, and the supply chain (particularly in chip fabrication). To solve this, Microsoft and OpenAI are reportedly planning to build a $100 billion data centre called ‘Stargate’, which is expected to launch by 2028. Stargate will require several gigawatts of power—equivalent to running multiple large data centres today, possibly reaching 5 gigawatts by then. Helion is the Secret of OpenAI & Microsoft’s Energy It’s funny how Altman is all over the place, leaving no aspect of AI untouched—from building AI models and devices to hardware and computing. Computer scientist Pedro Domingos quipped, saying, “Sam Altman’s new venture fund is called AI, Devices, Hardware, and Deuterium (ADHD).” In line with this, Altman is in talks with Emerson Collective and Thrive Capital, both major investors in OpenAI, to partner on an AI device project led by former Apple designer Jony Ive. Ive, known for designing the iPhone at Apple, is seeking to secure up to $1 billion in funding for this venture. Notably, this will not be Altman’s first investment in an AI device company. Earlier, he invested in Humane, which launched AI Pin, a wearable device, last November. However, Altman’s plans are bigger than those of AI devices. The chief of OpenAI is of the opinion that an energy breakthrough is necessary for future artificial intelligence, which will consume vastly more power than people have expected. In 2021, Altman invested $375 million in Helion Energy, which is working on Project Polaris, which will generate electricity from nuclear fusion by 2024. Last year, Microsoft agreed to purchase electricity from Helion’s first fusion power plant, which is scheduled for deployment in 2028. Helion plans to produce 50 megawatts of energy for Microsoft. Helion is most likely to power ‘Stargate’ as well. “Helion’s doing the best work, but I’m happy there’s a race for fusion right now. Nuclear fusion is also quite amazing,” said Altman, hopeful and optimistic. where @Helion_Energy will soon start to install polaris: pic.twitter.com/Tk7znzvOPg— Sam Altman (@sama) February 2, 2024 Oklo is another nuclear startup backed by Altman. Oklo is developing commercial applications for nuclear fission, which is the fundamental reaction powering existing nuclear power plants, albeit with a focus on smaller-scale reactors. Scaling Transformer models With OpenAI developing GPT-5 and many more new models in the future, it’s logical for the company to develop its own energy resources and data center. For instance, OpenAI’s latest text-to-video generation model, Sora, demands a huge compute to run, which could be one reason why it hasn’t been made publicly available yet, along with security concerns. According to Altman, AI is going to be more like energy or something. He believes that in the future, it’s all going to end up about how much compute one has and at what price. “If it’s really cheap, I’ll have it like reading my email all day, like giving me suggestions about what I maybe should think about or work on and trying to cure cancer. And if it’s really expensive, maybe I’ll only use it, or will only use it, to try to cure cancer,” he explained. OpenAI is not alone. Amazon is investing nearly $150 billion over the next 15 years in data centers, providing the cloud-computing leader with the resources to manage an anticipated surge in demand for  AI applications and other digital services. Similarly, Elon Musk said that AI compute is growing exponentially, increasing by a factor of 10 every six months, and most data centers are transitioning from conventional to AI compute. To support these data centers Musk  joked that we need “transformers for the transformers” — voltage transformers for our AI’s neural net transformers. “That’s the main issue we’re facing this year,” he added. Likewise, at the recent GTC 2024, Huang drew parallels between data centers and factories during the industrial revolution. He explained how data centers now produce text tokens using data and electricity as raw materials, and compared it with the production of electricity during the industrial revolution, when energy was used. AI Chip Venture While Sam Altman’s plan to raise $7 trillion for an AI venture turned out to be a joke, it doesn’t dismiss the fact that he is planning to start his own AI chip venture. According to recent reports, he is seeking approval from the U.S. government for this new venture. Furthermore, earlier this year, it was reported that Altman was in discussions with investors from the Middle East and chip fabricators like TSMC about starting a new chip venture. Surprisingly, OpenAI has opted not to use NVIDIA’s GPUs in Stargate, instead exploring alternatives like AMD and Microsoft’s new AI chip, Maia 100. Moreover, OpenAI has told Microsoft it doesn’t want to use NVIDIA ’s proprietary InfiniBand cables in the Stargate supercomputer. With Altman trying to lessen its dependence on NVIDIA, the signs are obvious he is up to something. However, moving away from NVIDIA won’t be easy, especially after its recent breakthrough in breaking Moore’s Law with its latest GPU, Blackwell.
Unlike the information age where data were made and distributed, generative AI now creates entirely new content in real-time, demanding significant computational power.
“Compute is going to be the currency of the future. It will maybe be the most precious commodity in the world. And we should be investing heavily to make a lot more compute,” said Sam Altman.
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Siddharth is a media graduate who loves to explore tech through journalism and putting forward ideas worth pondering about in the era of artificial intelligence.