The ambitious Stargate project, a multi-billion-dollar artificial intelligence infrastructure initiative led by SoftBank and OpenAI, has significantly scaled back its near-term plans, now aiming to build only a single small data center by the end of 2025. This adjustment comes amidst reported disagreements between the two key partners over crucial terms of their collaboration, including the preferred locations for these massive facilities. As Cointelegraph stated in a recent tweet, "SoftBank and OpenAI's Stargate project is scaling back on its plan, aiming to build a small data center by year-end as the partnership faces disagreements over crucial terms."
The Stargate project was unveiled with considerable fanfare in January, with U.S. President Donald Trump hosting top tech CEOs, including OpenAI's Sam Altman and SoftBank's Masayoshi Son, at the White House. The initial vision for the $500 billion endeavor promised to create over 100,000 jobs and establish the U.S. as a leader in AI infrastructure, with an immediate commitment of $100 billion for deployment. Oracle is also a key partner in the broader initiative, which was likened by some to the Manhattan Project due to its scale.
However, six months after its high-profile announcement, the venture has not yet finalized a deal for a large-scale data center. Sources familiar with the matter indicate that the primary hurdle has been a fundamental disagreement between SoftBank and OpenAI regarding the strategic placement of these critical AI computing hubs. This internal friction has directly led to the reduction of the project's immediate objectives.
Despite the slowdown within the joint Stargate venture, OpenAI has independently pursued and secured significant data center capacity. The company has finalized separate deals with Oracle and CoreWeave, which collectively are expected to provide nearly as much computing power as Stargate initially aimed to deliver for the current year. The agreement with Oracle alone involves OpenAI committing to pay over $30 billion annually for 4.5 gigawatts of capacity, demonstrating OpenAI's urgent need for advanced compute resources.
In a joint statement, SoftBank and OpenAI have publicly maintained that they are moving "with urgency on site assessments" and are actively advancing projects in multiple states. While the long-term vision for Stargate remains, the immediate focus has shifted to the more modest goal of establishing a smaller data center, likely in Ohio, by year-end, reflecting the challenges in aligning the strategic interests of its leading partners.