The United States' "Stargate" has had a rocky start, with no data center established after six months of operation

The United States' artificial intelligence infrastructure project “Stargate” is facing serious setbacks. This $500 billion project, announced by the White House in January this year, has not only significantly reduced its recent plans but also the newly established company responsible for its implementation has yet to complete any data center transactions.

According to media reports on the 22nd, the key leaders of the project, SoftBank and OpenAI, have disagreements on critical cooperation terms, including core issues such as the construction site. Although the two companies promised to "immediately" invest $100 billion when they announced in January, the project's current goal has been scaled back to constructing a small data center by the end of this year, potentially located in Ohio.

Meanwhile, eager to secure computing power supply, OpenAI CEO Sam Altman has bypassed SoftBank and reached a data center agreement with Oracle worth over $30 billion annually. The scale of this separate deal is almost equivalent to the original target for the Stargate project this year, highlighting the slow progress of the joint project.

Despite the project's difficulties, Masayoshi Son and Altman continue to maintain a positive image of their cooperation in public. Last week, the two attended a SoftBank event together, where Altman stated that both parties have a preliminary goal of jointly building a 10-gigawatt data center and praised it as an "excellent collaboration."

Partner Disagreements Hinder Project Progress

Although they publicly express a willingness to cooperate, the two giants behind “Stargate” have been experiencing constant friction in actual operations.

According to media reports citing informed sources, the two sides have been unable to reach an agreement on key terms such as the construction site for the data center, with one point of contention being how to broadly utilize the construction land related to SB Energy, an energy developer supported by SoftBank.

This disagreement has led to a standstill in the project. According to the initial plan, SoftBank was to focus on financial details while OpenAI was responsible for operations. However, the reality is that the project has yet to reach a final agreement on any data center project. Reports indicate that Oracle CEO Safra Catz bluntly stated during an investor conference last month, “The ‘Stargate’ has not been established.”

Notably, Altman has begun using the name “Stargate” for some projects that are not funded by the joint venture. Public documents show that the trademark rights for the name are held by SoftBank. Informed sources indicate that OpenAI's data center projects in Abilene and Denton, Texas, although referred to as part of “Stargate,” have not actually received investment from SoftBank.

OpenAI "Going Solo," Independently Advancing Large-Scale Data Center Deals

Faced with the stagnation of cooperation with SoftBank, Altman has chosen to act independently. According to informed sources, **OpenAI recently reached a massive data center agreement with Oracle that will start paying this software and cloud computing company over $30 billion annually within three years **

The total capacity of the transaction reaches 4.5 gigawatts, consuming power equivalent to two Hoover Dams, enough to power approximately 4 million households. The data centers are distributed across multiple locations in the United States. Along with the smaller-scale agreement reached between OpenAI and CoreWeave, the data center transaction capacity completed by OpenAI has nearly reached the annual target promised by Stargate in January.

According to OpenAI's estimates, $100 billion is roughly equivalent to 5 gigawatts of data center capacity.

SoftBank's AI Investment Strategy Faces Challenges

Despite these challenges, the leaders of both companies have publicly stated that cooperation is progressing smoothly. Last week, they appeared via video at a SoftBank event, where Altman stated that their initial goal is to jointly build 10 gigawatts of data center capacity. The two companies issued a joint statement saying they are advancing projects in multiple states:

"Advancing at an ultra-large scale and speed, providing AI infrastructure that will power and serve humanity in the future."

The predicament of the Stargate project poses a significant setback to Masayoshi Son's AI ambitions. Over the past decade, he has invested more than $140 billion through two of the largest venture capital funds in history to find future AI companies, but missed out on OpenAI and all its competitors before the release of ChatGPT, while also facing criticism for high-profile failures such as WeWork and the construction startup Katerra.

Earlier this year, SoftBank committed to investing $30 billion in OpenAI, the largest single investment in a startup to date. To complete this massive investment, SoftBank had to take on new debt and sell assets. According to insiders, despite the slow start of the Stargate project, Masayoshi Son remains optimistic about OpenAI and hopes to further increase investment in the company.

In November last year, Masayoshi Son and Altman met in Tokyo to finalize the framework of the agreement. They then proposed a plan to the Trump team for large-scale investments in the United States. On the second day of the new Trump administration, the three announced a commitment to invest $500 billion by 2029 at the White House.

"This is the beginning of our golden age," Masayoshi Son stated at the White House at that time