Elon Musk and OpenAI CEO Sam Altman are clashing once again, this time over the Stargate artificial intelligence (AI) infrastructure project, recently championed by President Donald Trump. The feud, rooted in past tensions on OpenAI’s board, has now extended to Musk’s influence with the new presidential administration.
On Tuesday, Trump announced the Stargate initiative—a joint venture between OpenAI, Oracle, and SoftBank—aiming to invest up to $500 billion in AI infrastructure. This partnership plans to construct data centers and electricity generation facilities in Texas, laying the groundwork for the rapid advancement of AI technologies.
Trump hailed the project as a testament to America’s potential under his administration. The White House detailed an initial private investment of $100 billion, which could expand fivefold.
Announcing The Stargate Project
The Stargate Project is a new company which intends to invest $500 billion over the next four years building new AI infrastructure for OpenAI in the United States. We will begin deploying $100 billion immediately. This infrastructure will secure…
— OpenAI (@OpenAI) January 21, 2025
Musk questions the investment
Hours after the announcement, Musk expressed skepticism on his social media platform, X, questioning the financial viability of the investment. “They don’t actually have the money,” Musk claimed, citing insider information about SoftBank’s limited secured funds.
Altman quickly refuted Musk’s allegations, inviting him to visit the first construction site and emphasizing the national importance of the project. “This is great for the country,” Altman wrote, suggesting Musk prioritize America’s interests in his advisory role.
A history of tension
The Musk-Altman feud traces back to their time as co-founders of OpenAI. Musk, an early investor and board member, has been critical of OpenAI’s shift from a nonprofit research lab to a for-profit entity. Last year, he filed a lawsuit accusing the company of deviating from its original mission. A hearing on the matter is scheduled for February in California.
Adding to the rivalry, Musk launched his own AI company, xAI, in 2023, which he claims faces unfair competition from OpenAI and its partner, Microsoft.
The Stargate project, first reported by The Information in March 2024, had been in development well before Trump’s announcement. Notably, a separate AI data center project was unveiled in July by Crusoe Energy Systems and Lancium near Abilene, Texas. The facility, powered by renewable energy, is now tied to the Stargate initiative.
Larry Ellison, Oracle’s co-founder, stated that the Abilene facility is one of 10 planned data center buildings, potentially expanding to 20 in the future.
Microsoft’s role and perspective
Microsoft, a major investor in OpenAI, is also contributing to Stargate but highlighted that its partnership with OpenAI will “evolve.” CEO Satya Nadella, speaking at the World Economic Forum, emphasised Microsoft’s independent $80 billion investment in global AI infrastructure, with $50 billion allocated to the U.S.
Laughing off the drama, Nadella said, “Look, all I know is, I’m good for my $80 billion.”
