OpenAI’s Sam Altman says the AI market may be in a bubble, but the long-term potential remains intact
OpenAI CEO Sam Altman has publicly acknowledged a belief that the current AI market could be in a bubble, telling The Verge and other reporters that investors may be overexcited about artificial intelligence. “My opinion is yes,” he said, describing the situation as a phase where hype has outpaced fundamentals.
In a wide-ranging discussion, Altman drew a parallel to the dot-com boom of the late 1990s, noting that bubbles often form around a kernel of truth. He pointed out that tech was genuinely transformative then—and remains so now—but warned that the exuberance around AI valuations has tilted toward irrationality. “When bubbles happen, smart people get overexcited about a kernel of truth,” he said. “If you look at most of the bubbles in history, like the tech bubble, there was a real thing. Tech was really important. The internet was a really big deal. People got overexcited.”
Altman also criticized what he called irrational funding patterns for AI startups, describing as “insane” the practice of backing ventures with minimal teams and ideas at sky-high valuations. “That’s not rational behavior,” he said, adding that someone will likely be burned by such exuberance. The industry has seen a string of high-profile raises for AI outfits—some backed by founders tied to OpenAI or inspired by its work—though the article notes several of these efforts are led by names like Ilya Sutskever and Mira Murati.
Despite the warnings, Altman stressed that the AI surge could still yield a substantial net win for the economy, even if individual bets fail. “Someone is going to lose a phenomenal amount of money. We don’t know who, and a lot of people are going to make a phenomenal amount of money,” he said. His broader view remains cautiously optimistic, suggesting that the rewards of AI progress could outweigh the risks in the long run.
Looking ahead, Altman indicated that OpenAI should be prepared to commit enormous resources to data-center infrastructure, describing a future where trillions of dollars are spent on data-center construction. He hinted that economists will have plenty to debate as the industry expands, while signaling confidence in OpenAI’s ability to endure the inevitable market shifts.
Commentary and context
– The conversation reflects a rising tension in the AI investment space: strong advances and real value on one side, and overheated expectations and funding gaps on the other. Altman’s candor underscores the need for careful capital allocation as compute and data needs scale.
– The focus on data-center expansion highlights a practical reality of AI progress: continued demand for massive, specialized infrastructure to train and run models. This is a major driver of capital expenditure across tech and cloud providers.
– For readers watching consumer tech, crypto, social platforms, and streaming services, the takeaway is that AI’s pace of investment and infrastructure buildout will influence product capabilities, pricing, and innovation cycles in the near term.
Summary
OpenAI’s Sam Altman acknowledged that the AI investment surge may be a bubble, likening it to past tech-driven exuberance while insisting there is a real, transformative core to AI. He warned of irrational funding in some startups, but he remains confident that AI overall can deliver a net positive for the economy—even if some bets fail. He also signaled that OpenAI plans to invest heavily in data-center infrastructure as AI capabilities scale.
Positive spin
Despite the caution, the interview reinforces a hopeful view: AI progress is grounded in tangible tech advances with broad long-term potential. If capital is allocated more rationally, and if the industry learns from past bubbles, the coming years could bring meaningful productivity gains, new services, and broader economic benefits driven by scalable AI infrastructure.