Nvidia Provides $105 Billion Backstop for OpenAI's Massive Ohio Data Center
Center-RightRigor 5818 sources
The Story
Nvidia announced on Monday it is providing up to $105 billion for a giant OpenAI data center in Ohio, offering a backstop should the ChatGPT creator face financial challenges. This move follows last week's pact with Wall Street firms to pursue $500 billion in financing for Nvidia's graphics processing units. OpenAI will lease a massive data center in Ohio for 20 years, supported by Nvidia's financing commitment. The project will be built on the site of a former Cold War-era uranium enrichment plant in Pike County, Ohio. It could eventually grow to have 8 gigawatts (GW) of capacity, making it the largest single data center for artificial intelligence (AI). The data center will run exclusively on Nvidia chips. Nvidia will provide compute, with capacity expected to come online in phases in 2028. SB Energy, a subsidiary of SoftBank, will build and manage the data center at the PORTS-Pike Technology Campus. SoftBank and SB Energy will invest more than $4 billion into local energy infrastructure and build at least 10 GW of new energy generation to power the data center. Nvidia will also invest $1.5 billion in SB Energy. OpenAI will commit $40 million to support local priorities. OpenAI CEO Sam Altman stated the project will have enough computing power for millions to use AI in new ways. OpenAI expects the project to create 35,000 temporary construction jobs over six years and 2,500 long-term operating jobs. Nvidia's cash flow increased 18-fold over the past three years to $48.5 billion in the latest period. Nvidia's financing guarantee, its largest, marks a shift in scale for a common sector practice where AI developers depend on financial backing from suppliers. Nvidia previously considered a $250 billion backstop for a 10-gigawatt data center at the Ohio location. The Wall Street Journal reported last week that Nvidia would cut that guarantee to less than $120 billion. Nvidia's shares fell 5% after those reports but are still up over 19% this year.
The Spread
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What they agree on
- Nvidia is providing up to $105 billion in financing for a new, massive OpenAI data center in Ohio.
- OpenAI will lease the data center for 20 years, and it will be built on the site of a former Cold War-era uranium enrichment plant.
- The data center could eventually reach 8 gigawatts of capacity and will run exclusively on Nvidia chips.
- SB Energy, a SoftBank subsidiary, will build and manage the data center, with SoftBank and SB Energy investing over $4 billion in local energy infrastructure.
- Nvidia will also invest $1.5 billion in SB Energy as part of the deal.
Where they split
- CNBC and Semafor emphasize Nvidia's role in providing a "backstop" or "financing" for the OpenAI data center, while Energy Intelligence and TechCrunch highlight Nvidia's direct "investment" in the Ohio gas plant and data center complex.
- The Wall Street Journal (quoted by RT) and RT focus on local opposition to data center developments in Kentucky, including a farming family rejecting a multimillion-dollar offer, a detail not present in other coverage of the OpenAI/Nvidia deal.
- Reason and West Virginia Watch (quoted by Reason) detail West Virginia's plan to use data centers to eliminate its income tax and local opposition to a specific project, which is a regional policy discussion not covered by other outlets focusing on the Ohio project.
- TechCrunch includes details about Groq raising $350 million and its pivot from AI chipmaker to neocloud company, providing broader industry context on AI infrastructure that is not central to other articles on the OpenAI/Nvidia deal.
Source Perspectives
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