Microsoft, OpenAI envision $100 billion data center project

Microsoft, OpenAI envision $100 billion data center project
Microsoft, OpenAI envision $100 billion data center project

Microsoft (MSFT.O) and OpenAI are collaborating on a data center project that could require up to $100 billion and include an artificial intelligence supercomputer called “Stargate,” which is set to launch in 2028.

Microsoft (MSFT.O) and OpenAI are working on a data center project that might cost up to $100 billion and contain an artificial intelligence supercomputer called “Stargate,” planned to start in 2028.

OpenAI did not immediately respond to inquiries.

The rapid use of generative artificial intelligence technology has resulted in skyrocketing demand for AI data centers capable of handling more complex jobs than traditional data centers.

According to a source, Microsoft would most likely finance the project, which is projected to cost 100 times more than some of the largest existing data centers, citing people involved in secret discussions about the concept.

According to the source, the projected supercomputer in the United States would be the largest in a series that the corporations plan to create over the following six years.

The estimated cost of $100 billion was based on conversations with Altman and viewing some of Microsoft’s original cost projections. It did not name the sources.

Altman and Microsoft have divided the supercomputers into five phases, with Stargate being the fifth. According to the article, Microsoft is developing a smaller, fourth-phase supercomputer for OpenAI that will be launched around 2026.

Microsoft and OpenAI are in the middle of the third phase of the five-phase plan, with a large portion of the expenditure for the next two stages involving the acquisition of needed AI chips.

AI chips are frequently sold for exorbitant prices. Chip company Nvidia (NVDA.O.) opens a new tab. CEO Jensen Huang had said earlier in March that the next “Blackwell” B200 artificial intelligence chip will cost between $30,000 and $40,000.

Microsoft also introduced two custom-designed processing chips in November of last year.

According to the source, the new initiative will include chips from a variety of manufacturers.

“We are always planning for the next generation of infrastructure innovations needed to continue pushing the frontier of AI capability,” a company representative said.

According to the article, the plan’s expenses might surpass $115 billion, more than double Microsoft’s capital investment last year on servers, buildings, and other equipment.

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