The future of a monumental $100 billion artificial intelligence partnership between two American technology titans hangs in the balance, with reports suggesting the mega-deal could be unravelling despite previous public commitments.
Deal Stalls in Preliminary Stages
OpenAI and Nvidia announced their ambitious memorandum of understanding in November, with Nvidia pledging to invest the colossal sum to help OpenAI construct at least 10 gigawatts of computing power. However, insiders speaking to the Wall Street Journal have revealed that the agreement has failed to progress beyond preliminary discussions, with both parties now actively reconsidering their positions.
Internal Criticisms and Competitive Pressures
Sources indicate that Nvidia's Chief Executive Jensen Huang has privately expressed concerns about OpenAI's business approach, casting doubt on the partnership's viability. Huang is reportedly anxious about the rapid growth of competing AI systems, particularly Google's Gemini and Anthropic – the latter having already secured substantial investment promises from Nvidia.
A Nvidia spokesperson maintained to the WSJ that OpenAI remains their preferred partnership, stating they continue to work with the AI company towards an agreement. OpenAI responded similarly, noting: 'Our teams are actively working through details of our partnership. NVIDIA technology has underpinned our breakthroughs from the start, powers our systems today, and will remain central as we scale what comes next.'
Complex Investment Landscape
Industry observers suggest a complete withdrawal by Nvidia appears improbable given OpenAI's status as one of their most significant investors. Nevertheless, Nvidia's parallel investment strategy includes substantial commitments to competitors, notably Anthropic, where they have pledged up to $10 billion.
The original letter of intention outlined that, should the partnership proceed, the first gigawatt of Nvidia systems would be deployed during the second half of 2026. This announcement followed closely on the heels of OpenAI's tentative agreement with Microsoft, which would grant the software giant a $100 billion equity stake in OpenAI's for-profit corporation.
Strategic Importance and Governance Structure
Sam Altman, OpenAI's chief, emphasised the critical nature of the proposed infrastructure during the initial announcement. 'Building this infrastructure is critical to everything we want to do,' Altman stated. 'Without doing this, we cannot deliver the services people want. We can’t keep making better models.'
Altman clarified that both Nvidia and Microsoft would function as 'passive investors', with OpenAI's original nonprofit board retaining ultimate control over the company. This governance structure reflects OpenAI's founding as a nonprofit in 2015, with the board continuing to oversee the for-profit subsidiary responsible for developing and commercialising AI products.
The proposed Nvidia-built data centres represent additional capacity beyond previously announced projects, underscoring the scale of OpenAI's expansion ambitions. As negotiations continue behind closed doors, the technology world watches closely to see whether this landmark AI partnership will survive its current challenges or become another casualty of the intensely competitive artificial intelligence landscape.
