How Much Does an AI Supercomputer Cost? Microsoft and OpenAi Project Shatters Records

According to a new report shared by The Information, Microsoft and OpenAI are working on a new data center project, one part of which will be a massive AI supercomputer called "Stargate"

by Sededin Dedovic
How Much Does an AI Supercomputer Cost? Microsoft and OpenAi Project Shatters Records
© AI Revolution / Youtube channel

The world of artificial intelligence is on the cusp of a monumental leap forward, fueled by collaborations so ambitious it carries a price tag that would make astronomers blush. According to a recent report by The Information, Microsoft and OpenAI are pouring resources into a colossal data center project, with a centerpiece unlike anything the world has ever seen: a titanic AI supercomputer dubbed "Stargate." The price for this endeavor is as astronomical as the supercomputer's name suggests.

With a total cost rumored to exceed $100 billion, the project dwarfs even the largest data centers currently in operation. Spending over $100 billion on anything is a monumental undertaking, but when put into context, the number becomes even more staggering.

The information claims that the joint venture between Microsoft and OpenAI could cost a whopping 100 times more than some of the largest data centers operating today. The staggering cost estimate reportedly comes from individuals intimately familiar with discussions about the project, including a source who spoke with OpenAI CEO Sam Altman and another with access to Microsoft's initial cost analysis.

The publication wisely protects the anonymity of its sources, given the sensitive nature of the project. Stargate, which is said to be located in the US, would be the jewel in the line of installations that Microsoft and OpenAI are planning in the coming years.

While Stargate is tipped for a 2028 launch date, OpenAI won't be sitting still in the meantime. The next major AI upgrade is planned for a much earlier arrival, with the target being early 2025.

Microsoft CEO Satya Nadella (R) speaks as OpenAI CEO Sam Altman (L) looks on during the OpenAI on DevDay event© Justin Sullivan / Getty Images

This project represents the fifth and, for now, final phase in the supercomputer saga of Microsoft and OpenAI.

Currently, the two companies are in the third phase. Microsoft is reportedly already working on a "Phase Four" supercomputer, smaller in scale than Stargate, with a potential launch date of 2026. Although the specific capabilities of Stargate are still shrouded in secrecy, this is not surprising given the current boom in AI and the ever-present need for AI models to evolve.

With GPT-5 on the horizon, OpenAI and Microsoft are demanding that these massive data centers push the boundaries of artificial intelligence even further. With the potential cost exceeding $115 billion when all is said and done, it's worth noting that this sum would be more than three times what Microsoft spent on capital expenditures for buildings, equipment and servers during 2023.

So where where is all this money going? The information claims that the lion's share of the budget of the Phase Five plan comes from the mass procurement of specialized AI chips. In this light, the time may be right for us to be Nvidia, the leading manufacturer of these high-performance components.

OpenAI Chief Executive Officer Sam Altman walks on the House side of the U.S. Capitol on January 11, 2024 in Washington, DC© Kent Nishimura / Getty Images

The potential impact of Stargate

The implications of Stargate reach far beyond the realm of computing power.

Here are some potential consequences of this revolutionary project: Stargate's massive processing capabilities could accelerate AI development in ways previously unimaginable. This could lead to breakthroughs in areas such as natural language processing, computer vision and robotics.

The Birth of Artificial General Intelligence (AGI): While still a distant horizon, Stargate could be a stepping stone toward achieving AGI, a hypothetical AI capable of human-level or even surpassing human intelligence. The advances in artificial intelligence enabled by Stargate could have a profound impact on a wide range of industries, from healthcare and finance to manufacturing and transportation.

As AI becomes more sophisticated, ethical concerns surrounding its development and use become paramount. OpenAI and Microsoft will need to proactively address these issues to ensure that their progress benefits humanity as a whole.

When looking at the numbers that are being handled around the artificial intelligence industry today, it's good to ask whether the accountants have gone crazy and are just punching zeros at the end of the amount, or whether that much money will really be invested.

Altman himself talks about billions of investments in the microchip factory, Microsoft promises a hundred billion dollars as if from the sleeve, Nvidia invested close to a billion dollars last year in its own and partner projects.

For comparison, so far investments in the self-driving car industry totaled "only" one hundred billion The journey towards the activation of the Stargates is a long and difficult journey, but at the same time a potentially revolutionary one.

With several years until its planned launch, much remains to be discovered about this ambitious project. The colossal venture between Microsoft and OpenAI represents a pivotal moment in the history of artificial intelligence.

The success or failure of Stargate could have a profound impact on the trajectory of AI development and its ultimate impact on our world.