The Nvidia-OpenAI Virtuous Circle Has an Ugly Side: Parmy Olson

Tech builders love a good feedback loop, and Nvidia Corp. and OpenAI have created a $100 billion one this week.

Nvidia is investing the sum in OpenAI as part of a build-out of data centers, potentially nabbing 2% of the company through the first $10 billion tranche. The circle continues with OpenAI pledging earlier this month to spend $300 billion on cloud compute from Oracle Corp., which also buys chips from Nvidia. Meanwhile, Nvidia is pouring $5 billion into Intel Corp., while OpenAI is formalizing a new corporate structure with its most important investor, Microsoft Corp.

The high cost of developing AI ...