SoftBank and OpenAI launch new joint venture in Japan as AI transactions become increasingly circular

The way AI trading is done these days, it appears that AI companies and their investors are copying the Circle of Life. However, it is a cycle of profit and will ensure that the money eventually returns to your coffers.

Case in point: SoftBank, which has invested tens of billions of dollars in OpenAI and billions more to build AI data centers and infrastructure, just launched a joint venture with the Japanese maker of ChatGPT to localize and sell the AI ​​company’s enterprise technology to businesses in the country. The first customer of this joint venture will be SoftBank itself.

The joint venture, called SB OAI Japan, will be 50:50 owned by SoftBank and OpenAI and will provide what the companies call “crystal intelligence.” This is defined as a “packaged enterprise AI solution” aimed at corporate management and operations in Japan.

“Crystal Intelligence is designed to help organizations improve productivity and management efficiency through the deployment of advanced AI tools. The solution combines OpenAI’s enterprise services with localized implementation and support provided through SB OAI Japan,” SoftBank said in a statement.

SoftBank appears intent on driving the AI ​​hype cycle and the resulting revenue. The company said all of its employees are “actively leveraging AI in their daily work” and that it has created 2.5 million custom ChatGPT instances for internal use.

The conglomerate said it will leverage the joint venture’s solutions across its various businesses, validate its effectiveness in product development and “business transformation,” and pass on the insights and expertise gained to other companies through SB OAI Japan.

The venture comes as analysts raise concerns about the truckloads of cash being poured into AI development and related initiatives, as well as the high valuations given to companies that benefit from AI. The move has been likened to the dot-com boom, where the proliferation of the internet ushered in a wave of venture capital and exorbitant valuations, and similar booms in previous decades, when vast sums of money were spent developing unproven business models with no clear sign of a meaningful return on investment.