Musk takes on OpenAI's Altman for $500 billion Stargate | News about Donald Trump

Elon Musk confronts OpenAI CEO Sam Altman about Stargate an artificial intelligence (AI) infrastructure project touted by President Donald Trump, the latest in a feud between the two tech billionaires that began on OpenAI's board and is now testing Musk's influence over the new president.

On Tuesday, Trump had discussed a joint venture investing up to $500 billion through a new partnership created by OpenAI, the maker of ChatGPT, along with Oracle and SoftBank.

The new entity, Stargate, is already beginning to build data centers and generate the electricity needed to further develop the rapidly developing AI technology.

Trump hailed it as a “bright statement of confidence in America's potential” under his new administration, with an initial private investment of $100 billion that could reach five times that amount.

But Musk, a close adviser to Trump who helped fund his campaign and now leads a government spending-cutting initiative, questioned the value of the investment hours later.

“They don't really have the money,” Musk wrote on his social media platform X. “SoftBank has well under $10 billion secured. I have this on good authority.'

Altman responded Wednesday, saying Musk was “wrong, as I'm sure you know,” and invited Musk to visit the first site in Texas, which is already under construction.

“(T)his is great for the country. I realize what's great for the country isn't always what's best for your companies, but in your new role I hope you'll put (America) first above all else,” Altman wrote, using a US flag emoji , to represent America.

Behind the feud

The public clash over Stargate is part of a long-running dispute between Musk and Altman that began with a boardroom rivalry over who should run OpenAI, which both men helped found.

Musk, an early investor and board member of OpenAI, sued the artificial intelligence company last year, alleging that it had betrayed the goals of its founding as a nonprofit research lab serving the public good rather than pursuing profits.

Since then, Musk has escalated the dispute, adding new claims and seeking an injunction that would stop OpenAI's plans to become more fully a for-profit business. A hearing is scheduled for early February in federal court in California.

The world's richest man, whose companies include Tesla, SpaceX and X, last year founded his own rival artificial intelligence company xAI, which is building its own big data center in Memphis, Tennessee. Musk says he faces unfair competition from OpenAI and its close business partner Microsoft, which has provided the massive computing resources needed to build AI systems such as ChatGPT.

When did Stargate start?

Tech news outlet The Information first reported on an OpenAI data center project called Stargate in March 2024, indicating that it was in the works long before Trump announced it.

Another company — Crusoe Energy Systems — announced in July that it is building a large and “custom-engineered AI data center” outside Abilene, Texas, at a site operated by energy technology company Lancium. Crusoe and Lancium said in a joint statement at the time that the project was “backed by a multibillion-dollar investment,” but did not disclose its backers.

AI technology requires huge amounts of electricity to build and operate, and the two companies said the project will be powered by renewable sources, such as from nearby solar farms, in a way that Lancium CEO Michael McNamara says will “deliver the maximum amount of green energy to as low as possible price”. Crusoe said it will own and develop the facility.

It is not clear how or when this project became the first phase of the Stargate investment unveiled by Trump. Oracle co-founder Larry Ellison said Tuesday that the Abilene project is the first of about 10 data center buildings currently under construction, and that number could increase to 20.

Where is Microsoft?

Absent from Trump's press conference on Tuesday was Microsoft, which has long supported OpenAI with billions of dollars in investment and allows its data centers to be used to build the models behind ChatGPT and other generative AI tools.

Microsoft said this week that it is also investing in the Stargate project, but issued a statement noting that its partnership with OpenAI will “evolve” in a way that allows OpenAI to “build additional capacity, primarily to research and train models'.

Asked about Musk's comments about the Stargate deal Wednesday during an interview with CNBC at the World Economic Forum in Davos, Switzerland, Microsoft CEO Satya Nadella addressed his company's own $80 billion plan to build its global AI infrastructure, of which $50 billion was spent in the US.

“Look, all I know is that I'm good for my $80 billion,” Nadella said, laughing.