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OpenAI Inks USD 30B Deal with Oracle for US-Based Data Centers

OpenAI Inks USD 30B Deal with Oracle for US-Based Data Centers
Image Source: Officer Banding Website
  • OpenAI signed a USD 30B-a-year deal with Oracle to lease 4.5GW of computing power, expanding its AI infrastructure plans.
    The agreement supports OpenAI’s USD 500B Stargate project, with Oracle building data centers across eight U.S. states.
  • Oracle shares hit a record high after the deal, reflecting growing demand for AI-focused cloud infrastructure services.

OpenAI

OpenAI agreed to lease 4.5 gigawatts of computing power from Oracle in a deal worth about USD 30 billion a year. 

According to Bloomberg, this is an unprecedented amount of energy that could power millions of American homes. This is because they describe a gigawatt to be akin to the capacity from one nuclear reactor. Furthermore, this can provide electricity to roughly 750,000 houses. 

This marks a big expansion of OpenAI’s Stargate data centre project which it launched with SoftBank Group. The project launched with the intention to invest USD 500 billion over the next four years. This is in order to build new AI infrastructure in the United States.

Data Centers

In order to fulfill the deal, Oracle will develop multiple data centers across the US.The potential location for the new data centers include Texas, Michigan, Wisconsin, Wyoming, New Mexico, Georgia, Ohio and Pennsylvania. So far, Oracle has developed a massive data center in Abilene, Texas, for OpenAI. Additionally, it has plans to expand it from its current power capacity of 1.2 gigawatts to 2 gigawatts. This center is being developed and financed by data center startup Crusoe.

Since signing this deal, Oracle shares have jumped up 5% to USD 229.98 which is a record high for them. The company is known for its database software and has recently gained traction for renting out computing power and storage. This is because they target  clients focused on AI work. 

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