Open AI, Oracle, and SoftBank to invest $500 billion in ‘Stargate’ AI project

The United States is set to receive up to $500 billion in private sector investment for artificial intelligence infrastructure from Stargate, a joint venture led by Open AI, Oracle, and SoftBank, the U.S. President Donald Trump announced on Tuesday, reports Reuters. The three companies intend to build 20 huge datacenters and create 100,000 jobs in the U.S. 

This announcement follows a report from March 2024 detailing a $100 billion data center project by OpenAI and Microsoft, also named Stargate. Whether this is a continuation or a separate initiative remains unclear.

Stargate’s owners – Open AI, Oracle, and SoftBank — have already allocated $100 billion for immediate use and the remainder planned over the next four years. Stargate will build 20 datacenters, each measuring 500,000 square feet (46,450 square meters), according to Larry Ellison, chief executive of Oracle. Construction of the first datacenter has already started in Texas, according to Ellison, though it is unclear whether this is an Oracle datacenter that will be transferred to Stargate. Keeping in mind that Oracle is based in Texas, it is possible that the company may construct a datacenter there too. However, Oracle Cloud Infrastructure (OCI) has not publicly announced plans to build its datacenters in Texas. 

The datacenters will power advanced AI, including artificial general intelligence (AGI), and provide applications for specialist tasks such as helping healthcare providers analyze health records. 

Investing $500 billion in 20 datacenters with adjacent infrastructure means that each datacenter will cost around $25 billion, which is a significant figure. It remains to be seen how much money will hardware companies like Nvidia, AMD, Intel, Dell, HPE, and Lenovo will get by supplying their parts to datacenters but it is safe to say that they will get tens of billions of dollars over the course of the next five years, which is huge money even for Nvidia.

The announcement featured top executives: OpenAI’s Sam Altman, Oracle;s Larry Ellison, and SoftBank’s Masayoshi Son. They credited Trump’s leadership for facilitating the project. In particular, Trump’s decision to roll back a prior executive order by Joe Biden, aimed at curbing AI risks, was framed as pivotal. Also, the current administration promised to simplify power production processes to meet the high electricity demands of AI datacenters that tend to employ hundreds of thousands of power-hungry GPUs. Altman noted that achieving artificial general intelligence domestically would not have been possible without the new administration’s support.