SoftBank and OpenAI launch new joint venture in Japan as AI deals grow more circular than ever

If you look at how AI deals are done these days, AI companies and their investors seem to be imitating the circle of life. Only, it’s a circle of profit that ensures the money eventually returns to their own coffers.

Case in point: SoftBank, which is investing tens of billions in OpenAI and committing dozens more to building data centers and AI infrastructure, just launched a joint venture with Japan’s ChatGPT maker that will localize and sell the AI ​​company’s enterprise technology to companies in the country. The first customer for this joint venture will be SoftBank itself.

The joint venture, called SB OAI Japan, will be owned 50-50 by SoftBank and OpenAI, and will provide what the two companies call “Crystal Intelligence,” which is defined as a “packaged enterprise AI solution” targeting corporate management and operations in Japan.

“Crystal Intelligence is designed to help organizations enhance productivity and management efficiency by adopting advanced AI tools. The solution combines OpenAI enterprise offerings with local implementation and support provided through SB OAI Japan,” SoftBank said in a statement.

SoftBank seems intent on feeding the hype cycle around AI and the resulting revenue: The group said that all of its employees are “actively using AI in their daily operations,” and that it has so far created 2.5 million ChatGPT instances dedicated to internal use.

The group said it will use the joint venture’s solutions across its various businesses, verify their effectiveness in product development and “business transformation,” and then transfer the insights and experience it has gained to other companies through SB OAI Japan.

The joint venture comes at a time when analysts are raising concerns about the large amounts of money being spent on developing artificial intelligence and related efforts, as well as the stratospheric valuations given to companies that benefit from it. This movement is likened to the dot-com boom, when widespread adoption of the Internet led to a wave of venture capital and soaring valuations, and similar booms over the past two decades in which huge sums of money were spent developing unproven business models with no clear sign of meaningful returns on investment.