FILE PHOTO: Microsoft, OpenAI reach new deal valuing OpenAI at $500 billion/File Photo
(Reuters) -OpenAI, Oracle and Related Digital will build a data-center campus of more than 1 gigawatt in Saline Township, Michigan, as part of their Stargate push to expand U.S. artificial intelligence infrastructure capacity.
The announcement made on Thursday underscores the AI industry's surging appetite for computing power, driven by the pursuit of technology capable of matching or surpassing human intelligence.
The companies said it was a multi-billion dollar investment, without disclosing the exact figure. Industry executives have said 1 GW of computing power, enough to power roughly 750,000 U.S. homes, can cost around $50 billion.
The construction is slated to begin in early 2026.
The project is part of Oracle and OpenAI's 4.5-GW Stargate expansion and, together with six other U.S. sites, raises the infrastructure group's planned capacity to more than 8 GW and total investment to over $450 billion in the next three years.
OpenAI said the move kept Stargate ahead of schedule to meet its $500 billion, 10-GW commitment. The startup has shared few details on how it plans to fund the spending.
Earlier this week, it completed a restructuring that frees the ChatGPT maker to move away from its nonprofit roots. Reuters has reported it was laying the groundwork for an initial public offering that could value the company at up to $1 trillion.
But surging valuations of AI companies and their massive AI spending commitments, which total more than $1 trillion for OpenAI, have raised fears that the AI boom is inflating into a bubble.
OpenAI said on Thursday Related Digital would develop the Michigan project, which is expected to create more than 2,500 union construction jobs.
"This project will help ensure Michigan is a key part of building the AI infrastructure that will power the next generation of American innovation," said Peter Hoeschele, OpenAI's vice president of industrial compute.
(Reporting by Aditya Soni and Akash Sriram in Bengaluru; Editing by Shilpi Majumdar)
