Microsoft, OpenAI plan $100b data centre in six years

Microsoft will combine forces with OpenAI for the construction of one of the world’s most expensive data center complexes at $100 billion.

Media reports claimed that the center will also sit an AI supercomputer named Stargate.

The Information reported that Microsoft would likely finance the project, which is expected to be 100 times more costly than some of the biggest existing data centers, citing people involved in private conversations about the proposal.

The proposed U.S.-based supercomputer would be the biggest in a series the companies are looking to build over the next six years, the report added. The Information attributed the tentative cost of $100 billion to a person who spoke to Altman about it and a person who has viewed some of Microsoft’s initial cost estimates.

The Microsoft-OpenAI joint venture would cost 100 times more than the largest data centres running today and contain “millions of GPUs,” the sources told the outlet.

Additionally, the report also stated that OpenAI is expecting to release its next major upgrade by early next year.

According to the report, Microsoft is also working on a smaller, fourth-phase supercomputer for OpenAI it is planning to launch in 2026. Microsoft and OpenAI are alleged to be in the third phase of the five-phase plan, with phases four and five focused solely on acquiring the AI chips needed for the projects.

“We are always planning for the next generation of infrastructure innovations needed to continue pushing the frontier of AI capability,” Microsoft spokesperson Frank Shaw said in a statement to The Information.

The entire multi-faceted project is expected to cost Microsoft a cool $115 billion – more than three times what Microsoft spent last year on capital expenditures for servers, buildings and other equipment, the report stated. Currently, over 10,000 data centres are operating around the world today, with about half located in the U.S.

Washington DC is considered one of the densest data center markets on record, with over 300 centers responsible for about one-third of the world’s online traffic, supporting companies such as Google, Amazon, Meta, and Microsoft.

Currently, Microsoft’s largest data centre is said to be the Columbia Data Center, which opened in Washington State back in 2007. Meanwhile, China Telecom ’s-Inner Mongolia Information Park is said to be the largest in the world.

Meanwhile, Microsoft has said it will now sell its chat and video app, Teams, separately from its Office product globally.

The company announced this on Monday, six months after it unbundled the two products in Europe in a bid to avert a possible EU antitrust fine.

According to a Reuters report, the European Commission has been investigating Microsoft’s tying of Office and Teams since a 2020 complaint by Salesforce-owned opens a new tab competing workspace messaging app Slack.

Teams, which was added to Office 365 in 2017 for free, subsequently replaced Skype for Business and became popular during the pandemic due in part to its video conferencing.