OpenAI’s $500 billion ‘Stargate’ project faces setbacks
OpenAI, SoftBank, and Oracle plan to invest $500 billion over the next four years into 10 gigawatts of AI infrastructure in the U.S.
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OpenAI’s colossal Stargate project is off to a slow start.
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The $500 billion effort, backed by SoftBank, Oracle, and MGX, was launched with the goal of developing AI data centers across the U.S. in a bid to secure the country’s AI leadership. But, according to the Wall Street Journal, the initiative has severely scaled back its plans for the near future.
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Complications between SoftBank and OpenAI have delayed the project, the Journal reported. According to unnamed sources, the companies have yet to cement any deals for a data center and they haven't decided on any locations. In particular, the companies are undecided on the extent to which they should build data centers on sites tied to SoftBank-backed SB Energy, sources told the publication.
People familiar with the matter say the company's new goal is to build a single, small data center by the end of the year, likely in Ohio, according to the Journal.
Meanwhile, OpenAI has been referring to a pair of projects currently under construction in Texas as being part of Stargate, even though Softbank is not involved with them, the Journal reports.
“Stargate is not formed yet,” Oracle CEO Safra Catz said on a call with investors last month.
In January, President Donald Trump announced the project at the White House, alongside OpenAI CEO Sam Altman, SoftBank CEO Masayoshi Son, and Oracle co-founder Larry Ellison. Altman called it “the most important project of this era” at the time. The companies have said they plan to build 10 gigawatts of AI infrastructure in the U.S.
The companies pledged to invest $100 billion into the company “immediately.
Meanwhile, OpenAI on Tuesday announced a $30 billion deal with Oracle to build a data center in the U.S. providing 4.5 gigawatts in additional computing capacity. “We now expect to exceed our initial commitment thanks to strong momentum,” an OpenAI press release stated.
The company estimates that the additional data center will create more than 100,000 jobs, including full-time operational roles, short-term construction jobs, and indirect employment in manufacturing and local service.
Still, that deal does not involve Softbank.