Elon Musk is clashing with OpenAI CEO Sam Altman over the Stargate artificial intelligence infrastructure project touted by President Donald Trump, the latest in a feud between the two tech billionaires that started on OpenAI’s board and is now testing Musk’s influence with the new president.
Trump had talked up a joint venture investing up to $500 billion through a new partnership formed by OpenAI, the maker of ChatGPT, alongside Oracle and SoftBank. The new entity, Stargate, is already starting to build out data centers and the electricity generation needed for the further development of fast-evolving AI technology.
Trump declared it a resounding declaration of confidence in America’s potential under his new administration, with an initial private investment of $100 billion that could reach five times that sum. But Musk, a close Trump adviser who helped bankroll his campaign and now leads a government cost-cutting initiative, questioned the value of the investment hours later.
Musk wrote on his social media platform X that the companies involved do not actually have the money, claiming SoftBank has well under $10B secured. Altman responded to say Musk was wrong and invited Musk to come visit the first site in Texas that is already under construction. Altman also stated that this project is great for the country and hopes Musk will put America first in his new role.
The public clash over Stargate is part of a years-long dispute between Musk and Altman that began with a boardroom rivalry over who should run OpenAI, which both men helped found. Musk, an early OpenAI investor and board member, sued the artificial intelligence company last year alleging it had betrayed its founding aims as a nonprofit research lab benefiting the public good rather than pursuing profits.
Musk has since escalated the dispute, adding new claims and asking for a court order that would stop OpenAI’s plans to convert itself into a for-profit business more fully. A hearing is set for February in a California federal court. The world’s richest man, whose companies include Tesla, SpaceX and X, last year started his own rival AI company, xAI, that is building its own big data center in Memphis, Tennessee.
Musk says xAI faces unfair competition from OpenAI and its close business partner Microsoft, which has supplied the huge computing resources needed to build AI systems such as ChatGPT. The Stargate project has been in the works long before Trump announced it, with another company, Crusoe Energy Systems, announcing in July it was building a large and specially designed AI data center at a site run by energy technology company Lancium.
The project was supported by a multibillion-dollar investment, but the backers were not disclosed. The project would be powered with renewable sources such as nearby solar farms. It’s not clear how and when that project became the first phase of the Stargate investment revealed by Trump. Abilene Mayor Weldon Hurt said construction began about nine months ago, but the city did not know it was going to be that big.
Oracle co-founder Larry Ellison said the Abilene project is the first of about 10 data center buildings currently being built, and that number could expand to 20. The region surrounding Abilene benefits from a wealth of energy sources, including oil, gas, solar, and some of the largest wind farms in the world.
The city of Abilene is excited about the opportunity to have the Stargate project, as it means a lot for the town and will make Abilene substantial. Missing from Trump’s press conference was Microsoft, which has long supported OpenAI with billions of dollars in investments and enabling its data centers to be used to build the models behind ChatGPT and other generative AI tools.
Microsoft said it is also investing in the Stargate project, but its OpenAI partnership will evolve in a way that enables OpenAI to build additional capacity, primarily for research and training of models. Microsoft CEO Satya Nadella pivoted to his company’s own $80 billion plan to build out its global AI infrastructure, of which $50 billion is being spent in the U.S.
