On January 21st, U.S. President Donald Trump announced a private sector investment of up to $500 billion for infrastructure in artificial intelligence aimed at maintaining a leading position in the technology industry.
Named the Stargate project, the initiative will be a collaboration between OpenAI (the creator of ChatGPT), SoftBank, and Oracle, set to construct data centers and generate over 100,000 jobs in the United States. Initial funding of $100 billion, provided by these companies and other equity partners, with the remainder to be invested over the next four years.
During the launch event at the White House, Trump was joined by SoftBank CEO Masayoshi Son, OpenAI CEO Sam Altman, and Oracle Chairman Larry Ellison. Ellison mentioned that construction has commenced on the first of the twenty data centers in Texas, each spanning half a million square feet. These facilities are intended to support AI applications focusing on analyzing electronic health records and aiding medical professionals in patient care.
Acknowledging Trump's role, Son stated, "We wouldn't have decided to do this, unless you won," while Altman emphasized, "We wouldn't be able to do this without you, Mr. President," highlighting the importance of Trump's leadership in advancing the project.
The announcement comes after reports in March 2024 by The Information regarding a similar $100 billion data center venture between OpenAI and Microsoft called Stargate, slated for a 2028 launch.
In response to former President Joe Biden's executive order on AI, aimed at mitigating risks associated with AI technology, Trump's announcement underscores the escalating need for large-scale computing power to support AI advancements in data centers.
Discussing the electricity demands of AI data centers, Trump mentioned facilitating energy production to meet increasing power needs, mitigating potential future power shortages across the U.S.
While Trump had promised a $1 trillion infrastructure bill during his 2016 campaign, prior to his presidency he did not make significant progress on this initiative. Despite previous discussions on infrastructure investments during his term as president, this latest announcement signals a significant move towards fulfilling that promise.
Market reactions were positive, with Oracle stocks climbing 7% upon the initial project report. Nvidia, Arm Holdings, and Dell shares also saw an increase, illustrating the growing investment interest in AI following OpenAI's ChatGPT launch in 2022.