Musk says OpenAI, SoftBank lack funds for Stargate project
Shortly after President Donald Trump announced a new $500 billion artificial intelligence project funded in part by OpenAI and SoftBank, Elon Musk expressed doubts about the financial capabilities of both companies to make it happen.
Trump unveiled the Stargate project during an event at the White House, joined by project investors OpenAI CEO Sam Altman, SoftBank founder Masayoshi Son, and Oracle Corp. co-founder Larry Ellison. OpenAI stated it would invest “over the next four years building new AI infrastructure for OpenAI in the United States, beginning with $100 billion immediately.”
Musk's Response
Musk responded on his social media platform, X, pointing out that OpenAI lacks the necessary funds, and "Softbank has well under $10 billion secured." Despite the ambitious project, OpenAI, SoftBank, and Oracle aim to collectively invest $100 billion each over the next four years.
Financial Backing
In December, President-elect Trump announced SoftBank's commitment to invest $100 billion in U.S. projects, without specifying the nature of these projects. SoftBank, a Japanese technology conglomerate known for its diverse investments, has stakes in various companies including Yahoo, Alibaba, Nvidia, and OpenAI.
Besides his involvement in Tesla, SpaceX, and X, Musk is also a major shareholder in xAI, an AI startup he established in 2023 with a $12 billion investment goal. xAI's mission is to advance scientific discovery and enhance understanding of the universe.
OpenAI, with a valuation of $157 billion, has secured investments from major players like Microsoft, Nvidia, Softbank, Citi, and Fidelity Investments.
Conflict of Interest
Musk, who was an early investor in OpenAI and a former co-chair of its board, resigned in 2018 to avoid conflicts of interest. Altman, the CEO of OpenAI, refuted Musk's financial concerns and invited him for a site visit. Oracle's Ellison confirmed the construction of data centers in Texas for the Stargate project.
Despite his close association with Trump, Musk has been a vocal critic on certain issues. His recent appointment to the Department of Government Efficiency reflects Trump's efforts to modernize federal technology.
The road ahead for the Stargate project remains uncertain, with questions looming over the financial capabilities of key investors like OpenAI and SoftBank.
The Associated Press contributed to this report.
