President Donald Trump on Tuesday is announcing investments worth up to $500 billion for infrastructure tied to artificial intelligence by a new partnership formed by OpenAI, Oracle and SoftBank.
The new entity, Stargate, will start building out projects needed for the further development of the fast-evolving AI in Texas, according to the White House.
Joining Trump for the announcement fresh off his inauguration will be Masayoshi Son of SoftBank, Sam Altman of OpenAI and Larry Ellison of Oracle. Son, a billionaire based in Japan, already committed in December to invest $100 billion in U.S. projects over the next four years. The head of SoftBank previously committed to $50 billion in new investments ahead of Trump’s first term, which included a large stake in the troubled office-sharing company WeWork.
While Trump has seized on similar announcements to show that his presidency is boosting the economy, there were already expectations of a massive buildout in data centers and electricity plants needed for the development of AI, which holds the promise of increasing productivity by automating work but also the risk of displacing jobs if poorly implemented.
Last October, the financial company Blackstone estimated that the U.S. would see $1 trillion invested in data centers over five years, with another $1 trillion being committed internationally.
Those estimates for investments suggest that much of the new capital will go through Stargate as OpenAI has established itself as a sector leader with the 2022 launch of its ChaptGPT, a chatbot that captivated the public imagination with its ability to answer complex questions and perform basic business tasks.
The White House has put an emphasis on making it easier to build out new electricity generation in anticipation of AI’s expansion, knowing that the United States is in a competitive race against China to develop a technology increasingly being adopted by businesses.
Still, the regulatory outlook for AI remains somewhat uncertain as Trump on Monday overturned the 2023 order signed by then-President Joe Biden to create safety standards and watermarking of AI-generated content, among other goals, in hopes of putting guardrails on the technology’s possible risks to national security and economic well-being.
CBS News first reported that Trump would be announcing the AI investment.
Trump supporter Elon Musk, worth more than $400 billion, was an early investor in OpenAI but has since challenged its move to for-profit status and has started his own AI company, xAI. Musk is also in charge of the “Department of Government Efficiency” created formally on Monday by Trump with the goal of reducing government spending.
Trump previously in January announced a $20 billion investment by DAMAC Properties in the United Arab Emirates to build data centers tied to AI.
(AP)
