Microsoft is easing its AI data center grip on OpenAI as part of new ‘Stargate’ plan

Microsoft and OpenAI have modified their partnership terms as OpenAI joins a $500 billion data center initiative with Oracle and SoftBank Group.

The big picture: The “Stargate” joint venture aims to construct AI data centers across the United States, representing a significant shift in OpenAI’s infrastructure strategy beyond its exclusive Microsoft partnership.

• President Trump announced the initiative at the White House, positioning it as a strategic move to maintain U.S. technological leadership over China
• The project will utilize Nvidia chips for AI computing capabilities
• The venture includes additional investors such as UAE-based MGX

Key structural details: OpenAI will maintain significant control within the new joint venture while preserving core elements of its Microsoft partnership.

• The venture is structured as a separate entity with OpenAI holding equity stake and operational control
• SoftBank CEO Masayoshi Son will serve as board chairman
• A dedicated board appointed by founding members will oversee operations, with its own CEO

Microsoft’s evolving role: While loosening some restrictions, Microsoft maintains critical aspects of its OpenAI partnership through 2030.

• Microsoft has approved OpenAI’s ability to build additional infrastructure, primarily for research and model training
• The company retains exclusive rights to offer OpenAI’s API services to developers and business customers
• Bilateral revenue sharing agreements between Microsoft and OpenAI remain in place
• OpenAI has committed to a new, large-scale usage of Microsoft’s Azure cloud services

Strategic partnerships: The initiative brings together multiple technology leaders while maintaining certain boundaries.

• Microsoft, Nvidia, and Arm will serve as technology partners without equity investment
• Oracle’s role appears limited as Microsoft maintains exclusive control over OpenAI’s API services
• The involvement of international investors like UAE’s MGX signals global interest in U.S. AI infrastructure

Looking ahead: This restructuring of relationships between major AI players could reshape the competitive landscape of AI infrastructure development, though Microsoft’s continued central role in OpenAI’s commercial operations suggests a carefully balanced approach to expansion rather than a dramatic shift in allegiances.