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A New Superpower Status Symbol: Data Centres
Almost a hundred years ago, New York’s skyline became the scene of a bitter battle. The prize: displacing the Woolworth Building as the world’s tallest property. Such superlatives mattered to a growing, industrialised nation keen to flex its dominance. The winner was 40 Wall Street, swiftly pipped by the Chrysler Building, which in turn lost the title to the Empire State Building.
Today, there is a new superpower status symbol: data centres. The latest bid for digital supremacy is Stargate. This mammoth project led by artificial intelligence company OpenAI, and announced by US President Donald Trump, pledges to spend up to $500bn over four years to construct world-changing AI infrastructure — basically warehouses filled with clusters of microchips — on an unprecedented scale.
Trump’s endorsement, with a reassurance that no government money is involved, shows data-centre dominion is now a national priority. That is no surprise. New regimes love big gestures. Think of the “10 great buildings” with which Chairman Mao peppered Beijing in 1959, or The Line, a 106-mile sliver of a city under construction at the behest of Saudi Arabia’s Crown Prince Mohammed Bin-Salman.
Stargate: A Trophy and an Arms Race
Stargate is a trophy too. But it is also an arms race, because OpenAI is in effect building a weapon. Co-founder Sam Altman’s goal is to achieve “artificial general intelligence”, the kind that outflanks human beings. That this is now a White House-backed initiative reflects a superpower reality: whichever country reaches AGI first poses a significant threat, commercially and militarily, to the rest.
What Does $500bn Buy?
What does $500bn buy? First, assume the money can actually be raised; departed OpenAI co-founder and Tesla head Elon Musk is sceptical. The latest Blackwell chips from Nvidia could cost about $50,000 apiece, suggesting Altman’s budget could cover 10mn of them. The biggest AI supercomputer in the world today, Musk’s Colossus, has about 100,000. Size alone does not guarantee AGI success, but it is an important factor.
A Hyperscaler in the Making?
At its most mundane, OpenAI is following other big technology firms. So-called hyperscalers Amazon, Meta Platforms, Microsoft and Alphabet are collectively on course to invest $260bn in capital expenditure next year, according to Visible Alpha. Stargate’s plan of an average $125bn a year is big, but not substantially greater than theirs.
But Altman’s scheme is undeniably different. Alphabet, Microsoft, Meta and Amazon are building computing power customers can use, with a path to sizeable near-term revenue. OpenAI’s foray is more of a moonshot. Succeed, and vast profit awaits. Fail, and a surfeit of servers could push down prices and profit for the whole industry.
A New Era of Competition
In the real world, meanwhile, traditional projections of power remain in fashion. China is planning 118 skyscrapers higher than London’s Shard, to add to the 100 or so it already has, according to the Council on Tall Buildings and Urban Habitat. Saudi Arabia, keen to be an AI hub, is also eyeing what will be the world’s tallest building, the Jeddah Tower. It’s just that in the AI age, there are more ways to reach for the heavens.
Conclusion
The Stargate project represents a new era of competition in the pursuit of technological supremacy. While traditional measures of power remain important, the ability to develop and deploy artificial intelligence will become increasingly crucial in the years to come.
FAQs
Q: What is the Stargate project?
A: The Stargate project is a massive initiative led by OpenAI to construct world-changing AI infrastructure, with a budget of up to $500bn over four years.
Q: What is the goal of the Stargate project?
A: The goal is to achieve “artificial general intelligence”, the kind that outflanks human beings.
Q: Is the Stargate project backed by the US government?
A: According to President Donald Trump, no government money is involved in the project.
Q: What is the significance of the Stargate project?
A: The project represents a new era of competition in the pursuit of technological supremacy, with significant implications for commercial and military power.
