OpenAI announces new company called Stargate Project, will invest $500 billion to develop AI data centres

Oracle, Nvidia, and OpenAI have come together to start a new company called the Stargate Project. OpenAI CEO Sam Altman says it will build new AI infrastructure for OpenAI in the United States.

In Short

• OpenAI announces new company called The Stargate Project
• The initiative is led by SoftBank and OpenAI
• The company is meant to help build AI infrastructure for OpenAI in the US

In a groundbreaking move, at the Trump inauguration, OpenAI on Wednesday announced a new company called the Stargate Project, which is aimed at “building a new AI infrastructure” through an ambitious investment of $500 billion over the next four years. OpenAI announced the new company in a blog post, which also revealed that the Stargate Project will begin deploying an initial $100 billion immediately to build AI data centres for OpenAI in the United States.

Along with OpenAI, the Stargate project is backed by companies like SoftBank, Oracle, and MGX. The initiative will be led by SoftBank and OpenAI. The two companies will also divide responsibilities with SoftBank looking at the finances, and OpenAI handling the operations. As per the blog post, SoftBank’s CEO, Masayoshi Son will serve as chairman of the Stargate Project.

OpenAI has announced other partnerships as well for the Stargate Project. The company will be working with the likes of Arm, Microsoft, NVIDIA, and Oracle for the same. “As part of Stargate, Oracle, NVIDIA, and OpenAI will closely collaborate to build and operate this computing system. This builds on a deep collaboration between OpenAI and NVIDIA going back to 2016 and a newer partnership between OpenAI and Oracle,” OpenAI writes on the blog post.
OpenAI says that the initial construction is going on in Texas. The company is also looking at new sites for future offices.

OpenAI is confident that the company will bring great benefits to the US economy. “This infrastructure will secure American leadership in AI, create hundreds of thousands of American jobs, and generate massive economic benefits for the entire world. This project will not only support the re-industrialisation of the United States but also provide a strategic capability to protect the national security of America and its allies,” the company’s blog post reads.

As for Microsoft, the company says that the new project will build on the “existing OpenAI partnership with Microsoft” and that the company will “continue to increase its consumption of Azure”. Microsoft also announced an update on its partnership with OpenAI late Tuesday. The company said that its agreement with OpenAI will stay intact until 2030, which includes Microsoft’s access to OpenAI’s intellectual property, their revenue-sharing arrangements, and exclusive rights to OpenAI’s APIs.

However, there was another significant update announced: There is a shift in Microsoft and OpenAI’s exclusivity agreement for additional capacity. In the blog post, Microsoft has announced that going forward, it will retain the “right of first refusal (ROFR)”, which means Microsoft will have the right of refusal on a new capacity that OpenAI wants to build.