Softbank, UAE's MGX Join $500bn Data Centre Deal With OpenAI

Japan’s SoftBank Group and the United Arab Emirates firm MGX will be part of a $500 billion deal with OpenAI and Oracle to build new AI data centres in the United States.

Leaders of the “Stargate” venture – OpenAI CEO Sam Altman, SoftBank CEO Masayoshi Son and Oracle founder Larry Ellison – went to the White House on Tuesday night, where President Donald Trump announced the deal, which he hailed as the “largest AI infrastructure project in history.”

Trump said the project, which will begin with a $100 billion investment to build data centres and computing infrastructure, would create 100,000 jobs.

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“What we want to do is we want to keep it in this country,” he said, adding that “China is a competitor and others are competitors. We want it to be in this country.”

He said it was intended to help keep the United States ahead of China and other rivals in the global AI race, using chips from Nvidia.

Microsoft changes terms of OpenAI deal

Microsoft on Tuesday said it had changed some key terms of a deal with OpenAI after the ChatGPT creator revealed its venture with Oracle and Japan’s SoftBank to build new AI data centres.

Microsoft had arrangements with OpenAI since 2019 that gave the Redmond, Washington-based company the exclusive right to build new computing infrastructure for OpenAI.

But Microsoft, in a blog post, said it has “approved OpenAI’s ability to build additional capacity, primarily for research and training of models.”

That opened the door for OpenAI to work with Oracle.

A person familiar with the deal said that Stargate is a joint venture structured as new entity in which OpenAI has an equity stake, governance rights and operational control.

It will have a separate board appointed by the founding members and its own CEO, this person said. The venture will also have other investors including MGX, a company from the United Arab Emirates.

Masayoshi to be Stargate board chairman

Microsoft, along with Nvidia and Arm, will be a “technology partner” in the new venture, but is not listed as an equity funder. SoftBank CEO Masayoshi Son is will be the entity’s board chairman, according to a statement from OpenAI posted on social media site X.

But Microsoft said that it still retains the exclusive right to offer OpenAI’s API – technology shorthand for application programming interface, which is the main way that software developers and business customers buy OpenAI’s services.

That means Oracle will not be able to host OpenAI’s primary source of revenue. Oracle did not immediately respond to a request for comment on Microsoft’s statements.

Microsoft said it has “revenue sharing agreements that flow both ways” with OpenAI.

“The key elements of our partnership remain in place for the duration of our contract through 2030, with our access to OpenAI’s IP, our revenue sharing arrangements and our exclusivity on OpenAI’s APIs all continuing forward,” Microsoft said.

Microsoft also said “OpenAI recently made a new, large Azure commitment that will continue to support all OpenAI products as well as training,” referring to Microsoft’s Azure cloud computing service.