OpenAI’s recent advocacy, centering around massive federal support for its operations, have generated significant controversy. During a video clip published by the Wall Street Journal, OpenAI’s Chief Financial Officer Sarah Friar expressed the company’s interest in a federal backstop for new investments. This assertion was met with immediate disbelief from more well-known users on X, causing Friar to walk back her statements just hours later.
In her opening statements, Friar emphasized that OpenAI is balancing heavy funding obligations. She stressed that the company is not seeking government guarantees for its datacenters. This is why she emphasized the role of the federal government in ensuring a level playing field among all companies. Taxpayer money should never go to bail out companies that fail to execute on sound business decisions.
I’d like to explain something I said during comments today. OpenAI is not asking for a government backstop for our infrastructure commitments. I shouldn’t have used the word ‘backstop’ and it created a confusing message. – Sarah Friar
Following the backlash, OpenAI’s CEO Sam Altman took to X to echo sentiments expressed by Silicon Valley venture capitalist David Sacks. In his testimony, Sacks reiterated in no uncertain terms that the U.S. government has no intention of bailing out AI companies. He described the idea of taxpayer-funded bailouts for AI companies as “absurd.” Altman seems to be on the right side of this one as well, since he suggested at the Recode event that OpenAI does not want government guarantees.
We don’t have government guarantees that OpenAI datacenters wishful thinking. We believe that governments should not pick winners or losers, and that taxpayers should not bail out companies that make bad business decisions or otherwise lose in the market. – Sam Altman
Even with this controversy over the nature of federal support, Altman is excited about OpenAI’s future. He pointed to the company’s burgeoning success across sectors, from enterprise offerings to new consumer devices, and most notably to strides made within robotic technology. Altman stated, “We expect to end this year above $20 billion in annualized revenue run rate and grow to hundreds of billions by 2030.”
In many ways, OpenAI’s recent months of activity signal its great ambitions. They’re on the hook for about $1.4 trillion in data center build-outs and data usage commitments over the next eight years. That hasn’t stopped the company from running up against its available computational resources, with the ability to produce chips limiting the company’s reach on more advanced chips. Altman noted that financing can be cheaper on account of the older chips. OpenAI would like to apply the most advanced technology in the world to its most advanced models.
As an example, we’ve previously argued for semiconductor loan guarantees in order to accelerate their buildout through new semiconductor fabs in the U.S. For-profit companies of all stripes — like our company — have answered the government’s call and are excited to be a part of it, even though we didn’t file an official application. – Sam Altman
Altman’s vision for OpenAI dovetails with a growing understanding that artificial intelligence is a national strategic asset. In light of the above, he said, this should give him confidence that the U.S. government understands this significance and is taking a proactive stance on AI development.
Many stakeholders in the AI community are closely watching these discussions. They are keenly watching how these advances will drive forthcoming investments and the regulatory environment. The relationship between technology companies and federal support will likely evolve as both sectors seek to balance innovation with fiscal responsibility.