The $500 billion Stargate project—a joint venture between SoftBank and OpenAI aimed at developing the U.S. artificial intelligence infrastructure—has encountered serious challenges at its inception and is now planning to take its first steps on a smaller, limited scale.
According to a report by The Wall Street Journal, this massive project, unveiled at a White House ceremony and intended to build an extensive network of data centers to support AI, has yet to make significant progress after several months. Instead of pursuing its ambitious plans, the project has prioritized building a small data center by the end of the current year.
Early Challenges for the $500 Billion Stargate Project
Although SoftBank and OpenAI initially pledged to invest $100 billion immediately upon introducing Stargate, major disagreements over data center locations and the nature of the partnership have slowed the project’s momentum. Sources familiar with the matter say that key disputes between SoftBank CEO Masayoshi Son and OpenAI CEO Sam Altman—particularly over the sites’ locations—have prevented final contracts from being signed.
While the Stargate project has experienced delays, Altman has independently moved forward by signing deals with other companies. This includes a major $30 billion annual contract with Oracle to build a 4.5-gigawatt data center—equivalent to the power consumption of more than two Hoover Dams and enough to supply electricity to around four million U.S. homes.
Despite the slow start, the Trump administration has declared the project a national priority and, by invoking an energy emergency, is attempting to remove legal obstacles and facilitate the development of energy infrastructure and data centers. One of the project’s stated goals is to create over 100,000 new jobs.
SoftBank’s $40 billion investment in OpenAI marks the largest investment ever in an AI startup. However, the financial strain of this investment has forced SoftBank to sell off assets and increase its debt. In addition to financial hurdles, the project also faces technical and operational challenges—such as finding suitable locations, building physical infrastructure, ensuring a stable power supply, and sourcing expensive AI chips—all of which have complicated its progress.
Nevertheless, Masayoshi Son remains optimistic about OpenAI’s future and plans to invest even more. Altman also continues to pursue the ambitious goal of building 10 gigawatts of data center capacity and describes his collaboration with SoftBank as an “extraordinary partnership.”
Overall, despite facing setbacks and disagreements at the start, Stargate—which launched under the banner of “the dawn of the AI golden age”—continues operations in several U.S. states and plays a key role in expanding the country’s AI infrastructure and data center capacity.
