Microsoft And OpenAI May Build $100B Supercomputer Campus
Microsoft and OpenAI's partnership has added a $115B artificial intelligence supercomputer campus to their pipeline — one of the most ambitious and expensive data center projects proposed to date.
Still in its planning phase, the Stargate campus could take up to two years to build and has a projected 2028 delivery date, according to The Information. Microsoft is searching for a site and determining the scope, whether the supercomputer will be in one building or multiple on a campus.
Stargate would be the largest and cost 100 times more than some of the biggest existing data centers, The Information reported.
The project is the finale in a series of supercomputers Microsoft and OpenAI have planned across five phases wrapping up by 2030. The duo is in Phase 3.
Phase 4 is in the works, consisting of a smaller supercomputer for OpenAI that is projected to open in 2026. A large portion of the price tag of Phase 4 and Stargate is getting the necessary AI chips, Reuters reported. Microsoft is expected to pick up the tab for the project.
Along with a hefty price tag, Stargate needs an enormous amount of power to be fully operational, up to 5 gigawatts.
The U.S.' aging grid is running out of power as AI and data center demand balloon. The U.S. used 19 GW to power data centers last year and is expected to grow to 25 GW by 2026, which is 6% of the nation's power. Roughly 2,500 data centers were under construction in 2023, with 3,000 on the way, CBRE estimated. Power shortages are slowing some projects by up to 72 months.
This leaves large-scale projects like Stargate to seek alternative power sources like nuclear energy, the report says. Amazon's newly acquired 1,200-acre data center campus in rural Pennsylvania is powered by a 2.5 GW nuclear power plant nearby.
The AI race is in full effect, and the U.S. is getting help from the CHIPS Act to keep up with the demand. In the government’s second round of funding last month, Intel won $8.5B to produce semiconductor factories, accelerating the pace of AI infrastructure manufacturing.
In its first round of funding last February, the government dropped $39B to BAE Systems, Microchip Technology and GlobalFoundries. More funding for similar projects is expected in the coming months.
Microsoft and OpenAI have been at the forefront of the AI race. OpenAI CEO Sam Altman is looking to build $7T worth of AI infrastructure via semiconductor and chip manufacturing. Microsoft partnered with Cushman & Wakefield in January to introduce AI tools into the firm.
