this post was submitted on 09 Jan 2026
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This is wrong. The truth is far worse.
Sam Altman / OpenAI recognized that they were losing their LLM market lead to rapid advances by Google Gemini and others, so they took the most anti-competitive step they could.
They determined that the key inputs for AI advances and market leadership now were access to high speed storage and graphics processing - whether directly or via contract to datacenters as-yet unbuilt.
They already had significant contracts and share-trade arrangements with Nvidia - whom is happily gouging the AI Bros for all they can. What everyone in that market needs though, is high speed memory chips for SSDs, RAM, and graphics card memory. So, they secretly negotiated two contracts simultaneously with the two largest memory chip manufacturers to aquire ~40% of the memory market supply.
They have agreed to buy memory chips wholesale, unuseable until they go through further manufacturing to install them intp RAM/SSDs/GFX - but OpenAI has zero facilities or contracts to perform those steps, and as yet has made no public announcement (that I've seen) of their actual plans for what to do with the chips they've entered contracts to buy.
It is a strategy called 'market denial', and we are all paying for it with much higher prices for anything that needs these chips or is tangential to those markets.
And lets not forget, by buying it from NVIDIA, they enable higher profits, which generates money that NVIDIA can invest into OpenAI to buy more stuff from NVIDIA.
And also, if you're going to soon have more stuff, you can take a loan on those assets that you will soon own to buy more assets that you will soon own!
That's kind of like the practice of hiring someone and putting them on the bench just so that they don't go work for a competitor. It's just sad.
So, do they just keep buying 40% of the production in perpetuity? What if production of those chips gets scaled up, do they just buy more?
It is a four year contract. OpenAI is hoping they'll be able to suppress their competitors long enough to regain their lead and firmly established a dominant position in the market.
I'm not too worried though for two reasons. First, I'm confident they'll eventually be in breech of their memory contracts for being unable to pay - as the whole AI market is a house of cards, and has no real path to profitability beyond hopes and dreams. Banks and angel investors will eventually start asking 'where are the profits' and begin pulling out the rug. Second, the chip suppliers began ramping up production (as you suggest) some time back, so the current crazy price increase should only be temporary once they have increased supply output in a year or so. They would have to sign new contracts to get their '40% deal' again, and the memory giants will have much higher price demands for any such deals in future, and I don't think OpenAI will have the money.
It's very hard, takes a lot of time, and is kinda pointless to scale it up, because everyone knows the demand won't last.
It's an oligopoly of mostly 3 companies who together have 90% market share. The third one not involved in this deal just announced they are closing their direct to consumer brand Crucial, and are focusing on AI as much as they can.
So this is only this year, but they can keep throwing nonexistent money at it in perpetuity as long as the bubble lasts.