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A top OpenAI executive backtracked on comments she had made endorsing a federal backstop for the AI startup's enormous research and development spending. Suggested Reading "OpenAI is not seeking a government backstop for our infrastructure commitments," OpenAI CFO Sarah Friar said in a social media post on late Wednesday. "I used the word 'backstop' and it muddied the point." Related Content Friar added that she had intended to say U.S. tech capabilities rests on the ability to expand industrial capacity with government and the private sector working in tandem. OpenAI did not immediately respond to a request for additional comment. Earlier on Wednesday, Friar had thrown her support behind a government guarantee so AI firms like OpenAI can maintain their spending spree on chips and new data centers. Those remarks came at a tech conference organized by The Wall Street Journal. Friar said there that a backstop "can really drop the cost of the financing, but also increase the loan to value, so the amount of debt that you can take on top of an equity portion." When The Journal asked Friar whether she meant a federal backstop, Friar responded: "Exactly." "I think the U.S. government in particular, has been incredibly forward leaning, has really understood that AI is almost a national strategic asset," Friar said. "That we really need to be thoughtful when we think about competitive competition with, for example, China." Friar added that the company has consistently been given a seat at the White House to weigh in on AI-related issues, including a government guarantee. The White House did not immediately respond to a request for comment. OpenAI is now a firm with a valuation of $500 billion. The AI giant has inked $1.1 trillion in agreements with chipmaking companies and cloud computing firms to propel an almost unchecked rise. On Monday, OpenAI announced a $38 billion deal with Amazon to widen its cloud computing services over seven years. Still, concerns linger among analysts about the potential for an AI bubble that could pop and wreak havoc on an economy already demonstrating signs of stalling out. In a recent podcast interview with investor Brad Gerstner, OpenAI CEO Sam Altman batted down questions about maintaining the company's huge spending commitments while earning only a small fraction in revenue. OpenAI, the maker of ChatGPT, still hasn't turned a profit in its nascent existence. Other business executives argue that the AI sector should adopt a hands-off approach that doesn't invite the government to step in with bailouts if a company fails. "Most of the AI spending is concentrated in a few firms that are incredibly rich and can afford to lose the money there," Matt Calkins, CEO of software development firm Appian, recently told Quartz. "I don't think it ought to be too big to fail. I see Sam Altman trying. I see OpenAI doing big deals with so many different partners that they won't want OpenAI to fail." 📬 Sign up for the Daily Brief
