On President Trump’s first day back in office, OpenAI’s Sam Altman, Oracle’s Larry Ellison, and SoftBank’s Masayoshi Son announced a historic $500 billion AI data center project. Dubbed the Stargate Project, this joint venture aims to revolutionize AI infrastructure in the U.S., creating tens of thousands of jobs and enhancing American leadership in AI. Learn about the project’s scope, ambitious goals, and debates sparking across the tech and political landscape.
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Welcome back to the AI Daily Brief today We are talking about a very cool one a Culmination of lots of conversations That have been happening for some time Now and the tldr of it is that yesterday Open aai CEO Sam Alman Oracle CEO Larry Ellison soft Banks masayoshi sun came Together with President Trump on his First day in office no less to announce A $500 billion AI data center company so Let's talk about what this project is Where it's coming from and try to wrap Our heads around the sheer magnitude of That number This project is all about building out Us data center infrastructure the new Construction will be conducted by a Joint venture called the Stargate Project which as many have noted is Probably open ai's first actually Genuinely cool name for something in Addition to open aai Oracle and SoftBank Abu Dhabi AI fund mgx will participate As an equity partner while arm Microsoft And Nvidia are all listed as Tech Partners aside from the announcement Being made at the White House it doesn't Appear that there's anything specific That the US government has to do with This initiative Or at least it doesn't appear that There's going to be any US government Money poured in however president Trump's interest in the project is
Pretty clear with him serving not only As Master of Ceremonies for the Announcement but saying that the project Would create over 100,000 American jobs And secure American leadership in AI in A joint statement Oracle open Ai and SoftBank said the Stargate project is a New company which intends to invest $500 Billion over the next four years Building new AI infrastructure for open AI in the United States we will begin Deploying a $100 billion immediately This infrastructure will secure American Leadership in AI create hundreds of Thousands of American jobs and generate Massive economic benefit for the entire World the project will not only support The reindustrialization of the United States but also provide a strategic Capability to protect the National Security of America and its allies so Let's talk about some of the details That we know so far the project will be Conducted in several stages with the First phase costing $100 billion and Already being underway this part Involves the construction of a super Cluster in o Texas this year the Facility seems to be the same one that Was being discussed towards the end of Last year as reporting emerged that open AI was hitting the limits of compute Available for Microsoft the information Reported that the site would cost around
3.4 billion for construction and scale To nearly a gigawatt of electricity Usage by mid 2026 that would be around Five times the size of xai's Colossus Supercluster one of the largest AI Supercomputers currently the abalene Facility is already huge with Larry Ellison commenting each building is a Half a million square ft there are 10 Buildings currently being built but it Appears the plan is to go much much Bigger 100 billion in data center Construction would be the largest annual Capital expenditure for any AI company To date topping Microsoft's $80 billion Spend for this year the project is then Planned to scale up to as many as 20 Data centers throughout the country open Aai researcher Nome Brown commented this Is on the scale of the Apollo project And Manhattan Project when measured as a Fraction of GDP this kind of investment Only happens when the science is Carefully vetted and people believe it Will succeed and be completely Transformative I agree it's the right Time for reference the Apollo program Cost $280 billion in inflation adjusted Dollars while the Manhattan Project cost $35 billion the other big comparison is The national highway system which cost Around $650 billion across more than a Decade project Stargate would represent About a half a percentage point of US
GDP each year similar in relative scope To these previous National Mega projects Sam Alman took the chance to be a little Bit poetic tweeting build monuments in The desert now we don't have any firm Idea of how large these super Club ERS Will be but presumably much larger than Colossus Colossus was already banging up Against the limits of networking Technology and was frankly assumed to be Impossible when construction began that Implies that project Stargate won't just Involve unprecedented amounts of capital But also significant technical Breakthroughs now in the announcement in Terms of division of responsibility they Said that soft bank and open AI are the Lead partners for Stargate with soft Bank having financial responsibility and Open aai having operational Responsibility masayoshi sun will be the Chairman of Stargate and as part of Stargate or Nvidia and open AI will Closely collaborate to build and operate This Computing system so obviously we'll Be watching closely to see what that Computing system actually consists of Overall this is explicitly the project To build AGI Altman clearly felt there Needed to be a grounded explanation for The goal he said that the technology Would be able to quote cure diseases at An unprecedented rate we will be amazed At how quickly we're curing various
Cancers and heart disease what this will Do for the ability to deliver very high Quality Healthcare and the cost but Really to cure the diseases at a rapid Rate I think will be among the most Important things this technology does Larry Ellison expanded on the point Stating that the technology will quote Allow personalized medicine yes it takes A huge investment but the results of the Investment will be vaccines that prevent Cancers he also discussed rapid Personalized mRNA vaccine development For pandemic prevention now while this Is clearly an exciting project not Everyone is necessarily enthusiastic Noted open AI rival Elon Musk posted They don't actually have the money SoftBank has well under $10 billion Secured I have that on good authority This Alman actually decided that he Needed to respond to tweeting a few Hours later wrong as you surely know Want to come visit the first site Already underway this is great for the Country I realize what is great for the Country isn't always what's optimal for Your companies but in your new role I Hope you'll mostly put America First a Critique that has perhaps less Competitive complication comes from Former congressman and libertarian Justin Amash who writes the Stargate Project sounds like the stuff of
Dystopian nightmares a US Government Announced Partnership of Mega Corporations quote to protect the National Security of America and its Allies and harness AGI for the benefit Of all of humanity let's maybe take a Beat here now I don't particularly hold This view but I do think that Justin is Right at least in the implication that We are going to have to have a Large-scale national conversation about Where government ends and private Enterprise begins in the era of AI not That this has ever been an easy line to Draw obviously it is one of the key Fault lines that divides people when it Comes to their political opinions and There is clearly some lobbying going on Around this on Monday scale AI CEO Alexander wank took got a full page ad In the Washington Post to declare dear President Trump America must win the AI War in an accompanying open letter Wang Called for the government to emulate the Investments made by big Tech firms Namely shifting their Tech spend to Compute he wrote China's government Outspends our government by about 10 Times on AI implementation and adoption AI progress relies on three pillars Compute algorithms and data the leading Global Tech companies have long Recognized this by investing Approximately 60% on computer 30% on
Data and 10% on algorithms this formula Is why American Commercial AI systems Are the best in the world and why China Benchmarks its government spending Against us in contrast our government Spends roughly 90% of Investments on Algorithms neglecting the other two Pillars so not only are we spending less We're not investing well to win our Government must adapt by changing our Investment strategy to more closely Reflect industry then we must not only Match but exceeds China's aggressive Funding for AI focused on fielding and Implementing AI Solutions very Shortlived open AI CEO and now founder Of a new stealth AI startup demit Shear Wrote this is a horrible framing we are Not at War we're all in this together And if we make AI development into a war We are likely to all die I can imagine a Worse framing but it takes real effort Why would you do this Wang responded It's a technology that China is racing To build faster than us so they can use To win militarily and expand their Regime but sure we can use nice words Instead the conversation goes on for There perhaps a little bit out of scope For this particular episode but one we Will no doubt come back to perhaps even For this week's long reads episode for Now friends things are getting real they Are getting big like a half a trillion
Dollars big this will be a very Interesting development to watch for now Appreciate you listening or watching as Always and until next time peace