Alexander Lewis
Mar 30, 2024
Microsoft and OpenAI are collaborating on an ambitious data centre initiative that includes the development of a cutting-edge artificial intelligence supercomputer named "Stargate." According to a report by The Information, the project is set to be launched in 2028 and could reach an estimated cost of up to $100 billion.
This project comes in response to the rapidly growing demand for generative AI technology, which requires data centres far more advanced than traditional ones.
Sources familiar with the project have indicated that Microsoft is likely to fund this massive endeavour. The cost is projected to be about 100 times greater than that of some of the largest current data centres, as per The Information's report, which cites anonymous sources close to the discussions.
This supercomputer, planned to be based in the US, is expected to be the largest among a series of advanced AI supercomputers Microsoft and OpenAI aim to build over the next six years.
Details about the project's tentative $100 billion budget were reportedly obtained from a conversation with Sam Altman, CEO of OpenAI, and from initial cost estimates seen by Microsoft insiders, although the sources of this information were not disclosed.
The development process for these supercomputers is divided into five stages by Altman and Microsoft, with Stargate being the final phase. Presently, the partnership is working on a smaller, fourth-phase supercomputer expected to be ready around 2026.
A significant portion of the expenditure for the upcoming phases is anticipated to go towards acquiring AI chips, which are often priced steeply. For instance, Nvidia's CEO Jensen Huang mentioned earlier in March to CNBC that their latest "Blackwell" B200 AI chip could cost between $30,000 and $40,000.
In November last year, Microsoft announced the creation of two custom computing chips, further underlining its commitment to this sector.
The report adds that the new project will be designed to be compatible with chips from various suppliers.
A Microsoft spokesperson stated in an email to Reuters, "We are always planning for the next generation of infrastructure innovations needed to continue pushing the frontier of AI capability." However, the spokesperson did not directly address the specifics of the Stargate supercomputer launch.
The Information's report also suggests that the total expenses for this project might surpass $115 billion, significantly more than Microsoft's capital spending on servers, buildings, and other equipment last year.
