Microsoft and OpenAI Plan $100 Billion Data Center Project – Details Here

According to reports, OpenAI and Microsoft are planning for a groundbreaking data center initiative, potentially costing up to $100 billion, which will introduce an artificial intelligence supercomputer named “Stargate” by 2028. However, OpenAI has yet to respond to requests for comment from Reuters.

The surge in demand for AI data centers, capable of handling more complex tasks than conventional data centers, has been driven by the growing popularity of generative artificial intelligence technology.

According to The Information, Microsoft might fund the project, which could be 100 times pricier than current large data centers. They got this information from insiders who are familiar with the private discussions about the proposal.

The report also stated that the proposed supercomputer would be the largest among several planned by the companies in the next six years, the report said.

The Information mentioned a rough cost of $100 billion from someone who spoke to Altman and someone who saw Microsoft’s initial cost guesses. However, they didn’t name these sources.

Altman and Microsoft have organized the supercomputers into five phases, which include Stargate in the fifth position. As per the report, Microsoft is currently developing a smaller supercomputer for OpenAI, which is expected to debut around 2026, as part of the fourth phase.

The collaboration between OpenAI and Microsoft is presently in the midst of the third phase of their five-phase strategy. The report indicates that a significant portion of the expenses for the upcoming phases will involve acquiring the necessary AI chips.

AI chips are frequently sold at premium rates. CEO of Nvidia chip company Jensen Huang, disclosed to CNBC earlier in March that their newest artificial intelligence chip called Blackwell B200 will cost around $30,000 to $40,000. In November last year, Microsoft revealed the development of custom-designed computing chips. 

The upcoming project aims to integrate chips from various suppliers, offering flexibility and optimization, according to the report.

A Microsoft spokesperson, in response to queries from Reuters, emphasized the company’s perpetual commitment to advancing AI capabilities through innovative infrastructure. However, the spokesperson refrained from commenting directly on the reported launch of the Stargate supercomputer.

Expenses for the initiative could surpass $115 billion, exceeding Microsoft’s capital spending for buildings, equipment, and servers in the previous year by more than triple, as indicated in the report.

Overall, this collaboration between OpenAI and Microsoft represents a massive step forward in artificial intelligence technology.