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Elon Musk criticizes OpenAI and SoftBank's $500 billion 'Stargate' deal backed by Trump

Elon Musk criticizes OpenAI and SoftBank's $500 billion 'Stargate' deal backed by Trump

Elon Musk criticizes OpenAI and SoftBanks $500 billion Stargate deal backed by Trump
X

22 Jan 2025 8:51 PM IST

Tesla CEO Elon Musk has raised doubts about OpenAI's ambitious $500 billion "Stargate" project, a deal backed by SoftBank, Oracle, and even U.S. President Donald Trump. Musk, an outspoken critic of OpenAI’s recent direction and a former co-founder, voiced his concerns on X, his social media platform, claiming the funds aren't secured.

The Stargate project, announced at the White House on January 21, 2025, is positioned as a groundbreaking initiative to bolster artificial intelligence infrastructure in the U.S. over the next four years. Backers of the deal, including SoftBank CEO Masayoshi Son, Oracle Chairman Larry Ellison, and OpenAI CEO Sam Altman, unveiled plans to invest $100 billion immediately, promising over 100,000 new American jobs and significant economic benefits globally.

However, Musk disputes the project's financial foundation, stating, "They don’t actually have the money. SoftBank has well under $10 billion secured," in a late-night post. His remarks highlight a rare disagreement with Trump, despite Musk being a key supporter of Trump’s 2024 campaign and a leader of a government task force, nicknamed DOGE, under the new administration.

This clash adds to Musk's ongoing rivalry with Altman. Musk has sued OpenAI over alleged mismanagement and founded xAI, a competing AI company that recently raised $6 billion at a $50 billion valuation. xAI's Colossus supercomputer project in Memphis, built using Nvidia chips, aims to compete directly with OpenAI’s AGI (artificial general intelligence) initiatives.

Stargate’s first venture, a one-million-square-foot data center in Texas, is already underway. While SoftBank will provide financial leadership, OpenAI will manage operations. Microsoft, Nvidia, and Arm are also key technology partners in the initiative.

Despite Musk's criticism, OpenAI expressed optimism about the project. In a statement, the company reiterated its commitment to advancing AI for humanity, calling Stargate a vital step toward achieving that goal.

As the dust settles on this landmark announcement, the spotlight remains on Musk, Altman, and their respective visions for the future of AI.

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