OpenAI plans to acquire up to 750 megawatts of computational capacity from chip manufacturer Cerebras over the course of three years as the creator of ChatGPT aims to advance in the AI competition and satisfy increasing demand.

According to reports, this agreement is valued at over $10 billion throughout the duration of the contract. The creator of ChatGPT intends to utilize the technologies developed by Cerebras to enhance its widely-used chatbot in the latest of several multi-billion-dollar agreements made by OpenAI.

Cerebras CEO Andrew Feldman mentioned that discussions between the two companies started last August after Cerebras proved that OpenAI's open-source models could operate more efficiently on its chips compared to conventional GPUs.

Following months of discussions, the firms finalized a deal in which Cerebras will provide cloud services utilizing its chips to OpenAI, concentrating on inference and reasoning models that generally require time to "reflect" before producing answers.

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Under the agreement, Cerebras will construct or rent data centers equipped with its chips, while OpenAI will compensate Cerebras for utilizing its cloud services to perform inference for its AI offerings. The capacity will be implemented in several phases until 2028.

"Adding Cerebras to our array of computing solutions is focused on enhancing the speed of our AI responses," OpenAI stated in a post on its site.

The agreement highlights the sector's significant demand for computing resources to perform inference—the method through which models answer questions—as firms compete to develop reasoning models and applications to promote adoption.

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The partnership will be crucial for Cerebras' recent initiatives to go public, as it will assist Cerebras in diversifying its revenue sources beyond the UAE-based tech company G42, which has been a significant investor and one of its major clients.

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Established in 2015, Cerebras is recognized for its wafer-scale engines, chips intended to enhance training and inference for substantial AI models, rivaling products from Nvidia and various AI chip manufacturers. Sam Altman, OpenAI's CEO, is among the initial investors in Cerebras.