Wednesday, January 22, 2025

Stargate Aims for $500 Billion Investment in U.S. AI-Focused Data Centers

The Stargate AI data center initiative, led by Oracle, OpenAI, and SoftBank, arguably aims to create up to $500 billion worth of new high-performance-computing infrastructure in the United States. 


While it does involve scaling up infrastructure to meet the growing demand for AI models and computational power, the initiative seems also to reflect a focus “up the stack,” even if the core effort can be described as creating high-performance-computing infrastructure at scale. 


Oracle’s participation suggests there will be an effort to optimize capabilities for enterprise applications while OpenAI’s presence obviously means a focus on apps requiring AI and capable of supporting more capabilities moving towards some form of artificial general intelligence. 


But even before that happens, Stargate aims to support compute-intensive AI apps across some key verticals that would seem to include healthcare, finance, and autonomous systems.


Remarks by President Donald Trump at the press conference announcing the venture also indicate some revision of permitting rules to allow local generation of electricity for the data centers as well. 


Though it is always possible the estimates will prove inflated, most observers expect a huge increase in HPC-capable data centers in the United States to 2030. On the other hand, existing data centers that add HPC capabilities are also likely. So “new” might better refer to “new capacity” rather than “new data centers” when looking at aggregate growth. 


Year

New U.S. HPC Data Centers

2025

50

2026

60

2027

70

2028

80

2029

90

2030

100


All that noted, a significant portion of HPC global demand will happen in the U.S. market. More than half of hyperscale data centers globally operate in the U.S. market, for example. 


 

source: Statista 


Stargate will not be the only entity aiming to build such infrastructure. Macquarie Asset Management has committed $17 billion to investments in Applied Digital and Aligned Data Centers, focusing on AI and HPC infrastructure across the Americas. 


Amazon Web Services, Google Cloud and Microsoft Azure also are racing to upgrade their HPC capabilities.


Nvidia is collaborating with various companies to build AI factories and data centers as well, including CoreWeave. 


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