Elon Musk, a close Donald Trump advisor questioned the value of the investment. Sam Altman responded, saying Elon Musk was “wrong, as you surely know”.
Elon Musk of Tesla clashed with OpenAI CEO Sam Altman on Wednesday and cast doubt on a $500 billion artificial intelligence (AI) investment announced by US President Donald Trump, saying the money promised for the investment wasn’t there.
The comments marked a rare instance of a split between the world’s richest man and Donald Trump, with Elon Musk playing a key role in the newly installed administration after spending $270 million on the election campaign.
On Tuesday, Donald Trump, in his first full day in the White House, announced a major investment to build infrastructure for AI led by Japanese giant SoftBank and ChatGPT-maker OpenAI. Trump said the venture, called Stargate, “will invest $500 billion, at least, in AI infrastructure in the United States.”
Stargate is already starting to build out data centres and the electricity generation needed for the further development of fast-evolving AI technology.
Donald Trump declared it “a resounding declaration of confidence in America’s potential” under his new administration, with an initial private investment of USD 100 billion that could reach five times that sum.
However Elon Musk, a close Donald Trump advisor who helped bankroll his campaign and now leads a government cost-cutting initiative, questioned the value of the investment hours later.
“They don’t actually have the money,” Elon Musk posted on his social media platform X.
“SoftBank has well under USD 10B secured. I have that on good authority,” he added.
Sam Altman responded, saying Elon Musk was “wrong, as you surely know” and inviting him to come visit the first site in Texas that is already under construction.
“(T)his is great for the country. i realize what is great for the country isn’t always what’s optimal for your companies, but in your new role i hope you’ll mostly put (America) first,” Altman wrote, using a US flag emoji to represent America.
Reason Behind the clash
The clash over Stargate is part of a years-long dispute between Elon Musk and Sam Altman that began with a boardroom rivalry over who should run OpenAI, which both men helped found, news agency Associated Press reported.
Musk, who is an early OpenAI investor and board member, sued Altman’s company last year, alleging it had betrayed its founding aims as a nonprofit research lab benefiting the public good rather than pursuing profits.
Musk has since escalated the dispute, adding new claims and asking for a court order that would stop OpenAI’s plans to convert itself into a for-profit business more fully. A hearing is set for early February in a California federal court.
The world’s richest man, whose companies include Tesla, SpaceX and X, last year started his own rival AI company, xAI, that is building its own big data centre in Memphis, Tennessee.
When did Stargate start?
Tech news outlet The Information first reported on an OpenAI data centre project called Stargate in March 2024, indicating that it has been in the works long before Trump announced it.
Another company – Crusoe Energy Systems – announced last July it was building a large and “specially designed AI data centre” outside Abilene, Texas, at a site run by energy technology company Lancium.
Crusoe and Lancium said in a joint statement at the time that the project was “supported by a multibillion-dollar investment” but didn’t disclose its backers.
AI technology requires huge amounts of electricity to build and operate and both companies said the project would be powered with renewable sources, such as nearby solar farms, in a way that Lancium CEO Michael McNamara said would “deliver the maximum amount of green energy at the lowest possible cost”.
Crusoe said it would own and develop the facility.
It’s unclear how and when that project became the first phase of the Stargate investment revealed by Trump.
