- OpenAI and Sur Energy have signed a letter of intent for a data center project in Argentina that requires an investment of up to $25 billion
- This data center project will be one of the largest infrastructure initiatives in the country’s history
- OpenAI CEO Sam Altman acknowledged that parts of the AI sector are “bubbly”
On Friday, the Argentine government revealed that OpenAI and Sur Energy have signed a letter of intent for a massive data center project.
According to the government officials, this partnership is expected to inject up to $25 billion in investment.
According to an official government statement, the planned facility will be a large-scale operation with a capacity of up to 500 megawatts, which will be mainly designed to provide much-needed computing power to advanced artificial intelligence tasks.
The project is structured under Argentina’s RIGI tax break scheme. The government’s statement mentioned that if the project is completed, it would stand as “one of the largest technology and energy infrastructure initiatives” in the country’s history.
While OpenAI’s generative AI models are taking the world by storm, the tech giant is gradually expanding its boundaries. This revelation comes after it solidified its status as the world’s most valuable startup with a $500 billion valuation following a secondary share sale. Not just this, the company now boasts more than 800 million weekly users for its ChatGPT platform.
Sam Altman Reacts to the First Stargate Project in Latin America
OpenAI’s Chief Executive Officer, Sam Altman, publicly confirmed the venture on social media. “We are proud to announce plans to launch Stargate Argentina, an exciting new infrastructure project in partnership with one of the country’s leading energy companies, Sur Energy,” Altman stated.
He also highlighted the strategic importance of the region, calling Latin America a place “full of talent, creativity and ambition.” He confirmed this would be the first Stargate project to be launched in Latin America.
Earlier this week, the company held its developer conference, DevDay, where it revealed its new upcoming collaborations.
The event revealed its partnerships with prominent companies, including Spotify, Zillow, and Mattel, alongside the debut of a new set of tools aimed at helping developers build innovative applications.
OpenAI CEO Altman Breaks Silence on AI Bubble
During the DevDay event, OpenAI’s Sam Altman broke from the typical script of many American tech executives by directly engaging with questions from reporters.
“I know it’s tempting to write the bubble story,” Mr Altman stated while addressing the issue head-on. “In fact, there are many parts of AI that I think are kind of bubbly right now.”
Amid the boom in AI startups, there is intense discussion going on around the potential overvaluation in the AI sector. Some people have raised questions privately and publicly about whether the high valuation of AI tech companies might be partly a result of “financial engineering.”
For instance, Goldman Sachs CEO David Solomon compared the current AI hype with the dotcom era. He affirmed that over the next one to two years, “there are going to be winners and losers” of the AI sector.
“I’m not going to use the word bubble, because I don’t know, I don’t know what the path will be, but I do know people are out on the risk curve because they’re excited,” he said.
Mr Altman has also admitted that the investment landscape in AI is not without its risks, expecting that investors will make some bad calls and that silly start-ups will secure excessive funding.
However, he stood firmly behind his own company, asserting, “There’s something real happening here.”
Many major firms and financial institutions have issued warnings about a potential threat of an AI bubble. The Bank of England, the International Monetary Fund, and JP Morgan boss Jamie Dimon have all expressed caution. Dimon, in comments to the BBC, advised that “the level of uncertainty should be higher in most people’s minds.”
