SAM Altman’s goal of raising about US$7 trillion to make artificial intelligence (AI) chips tells a story beyond his borderline-insane ambitions. First, the infrastructure needed to build AI has become exorbitantly expensive. Second, most of that value is still – still! – held by a handful of large technology companies; and the oligopoly is only going to get worse.

For all the competition that was spurred by the launch of ChatGPT in late 2022, and the flurry of new startups that jumped into the hyped-up generative AI market, most of those new players will likely fold or be folded into the incumbents over the next year or so. The costs of doing business are too high for them to survive on their own.

Take Sasha Haco, the chief executive officer of Unitary, which scans videos on social media for rule-breaking content. It would cost her company 100 times more than it charges clients to subscribe to OpenAI’s video-scanning AI tools. So Unitary makes its own models, which is a high-wire balancing act in itself. Her startup needs to rent access to those rare AI chips via cloud vendors such as Microsoft and Amazon.com’s Amazon Web Services. Those chips have doubled in price since 2020, Haco says, and they’re difficult to reserve. “We’ve had times when we can’t get access to what we need and so we have to pay 10 times the price,” she told me.