Microsoft was once the exclusive provider of data center infrastructure for OpenAI to train and run its AI models. No longer.
Coinciding with the announcement of Stargate, OpenAI’s massive new AI infrastructure deal with SoftBank, Oracle, and others, Microsoft says it has signed a new agreement with OpenAI that gives it “right of first refusal” on new OpenAI cloud computing capacity. That means that, going forward, Microsoft gets first choice over whether to host OpenAI’s AI workloads in the cloud — but if Microsoft can’t meet its needs, OpenAI can go to a rival cloud provider.
“OpenAI recently made a new, large Azure commitment that will continue to support all OpenAI products as well as training,” Microsoft said in a blog post. “To further support OpenAI, Microsoft has approved OpenAI’s ability to build additional capacity, primarily for research and training of models.”
OpenAI has blamed a lack of available compute for delaying its products, and compute capacity has reportedly become a source of tension between the AI company and Microsoft, its close collaborator and major investor. In June, Microsoft, under shareholder pressure, permitted OpenAI to ink a deal with Oracle for additional capacity.
In the blost post, Microsoft reiterated that “key elements” of its longstanding partnership with OpenAI remain in place through 2030, including its access to OpenAI’s IP, revenue sharing arrangements, and exclusivity on OpenAI’s APIs.
That assumes, of course, that OpenAI doesn’t achieve artificial general intelligence (AGI) under the two companies’ agreed-upon definition before then. When OpenAI develops AI systems that can generate at least $100 billion in profits, Microsoft will lose access to the company’s technology, according to a reported agreement between the firms.
OpenAI is said to be considering nullifying the agreement in a possible bid to secure more Microsoft funding.
“The OpenAI API is exclusive to Azure, runs on Azure and is also available through the Azure OpenAI Service,” the blog post reads. “This agreement means customers benefit from having access to leading models on Microsoft platforms and direct from OpenAI.”
We’ve reached out to OpenAI and Microsoft for more information and will update this post if we hear back.
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OpenAI says that it will team up with Japanese conglomerate SoftBank and with Oracle, along with others, to build multiple data centers for AI in the U.S.
The joint venture, called The Stargate Project, will begin with a large data center project in Texas and eventually expand to other states. The companies expect to commit $100 billion to Stargate initially and pour up to $500 billion into the venture over the next four years.
They promise it will create “hundreds of thousands” of jobs and “secure American leadership in AI.”
“The Stargate Project is a new company which intends to [build] new AI infrastructure for OpenAI in the United States,” OpenAI, Oracle, and SoftBank said in a joint statement. “This project will not only support the re-industrialization of the United States but also provide a strategic capability to protect the national security of America and its allies.”
The companies made the announcement during a press conference at the White House on Tuesday, where President Donald Trump spoke about plans for investment in U.S. infrastructure. SoftBank chief Masayoshi Son, OpenAI CEO Sam Altman, and Oracle co-founder Larry Ellison were in attendance.
Microsoft is also involved in Stargate as a tech partner. So are Arm and Nvidia. Middle East AI fund MGX will join SoftBank in its investment; MGX’s first public deal was an investment in OpenAI.
SoftBank, OpenAI, and Oracle are also listed as “initial equity investors” in Stargate.
“SoftBank and OpenAI are the lead partners for Stargate, with SoftBank having financial responsibility and OpenAI having operational responsibility,” the statement continued. “Masayoshi Son will be the chairman [of Stargate] […] As part of Stargate, Oracle, Nvidia, and OpenAI will closely collaborate to build and operate this computing system.”
The data centers could house chips designed by OpenAI someday. The company is said to be aggressively building out a team of chip designers and engineers, and working with semiconductor firms Broadcom and TSMC to create an AI chip for running models that could arrive as soon as 2026.
SoftBank is already an investor in OpenAI, having reportedly committed $500 million toward the AI startup’s last funding round and an additional $1.5 billion to allow OpenAI staff to sell shares in a tender offer. Oracle, meanwhile, has an ongoing deal with OpenAI to supply AI computing resources.
Softbank also earlier pledged to invest $100 billion in the U.S. over the next four years. Son and Trump have had a close working relationship since 2016, during Trump’s first term, when Son announced that SoftBank would invest $50 billion in U.S. startups and create 50,000 jobs.
The Information previously reported that OpenAI was negotiating with Oracle to lease an entire data center in Abilene, Texas — a data center that could could reach nearly a gigawatt of electricity by mid-2026. (A gigawatt is enough to power roughly 750,000 small homes.) Data center startup Crusoe Energy was said to be involved in the project, which was estimated to cost around $3.4 billion.
That Abilene site will be Stargate’s first site, and OpenAI says that Stargate is “evaluating potential sites across the country for more campuses as [it finalizes] definitive agreements.”
It’s unclear what connection, if any, Stargate has to a rumored partnership between Microsoft and OpenAI to spin up a $100 billion supercomputer. TechCrunch has reached out to OpenAI for additional information.
Last year, The Information reported that Microsoft and OpenAI would build a series of data centers for AI beginning in five stages over the next several years, culminating in Stargate: a 5-gigawatt facility spanning several hundred acres of land. Stargate was expected to take between five and six years to complete, according to The Information. In the lead-up to its completion, Microsoft had reportedly planned to launch a smaller-scope data center for OpenAI around 2026.
A number of tech leaders have called for the U.S. to up its investment in data centers, particularly as the AI industry continues to grow at an explosive pace. AI systems require enormous server banks to develop and run at scale.
Goldman Sachs estimates that AI will represent about 19% of data center power demand by 2028. OpenAI has blamed a lack of available compute for delaying its products, and compute capacity has reportedly become a source of tension between the AI company and Microsoft, its close collaborator and major investor.
Microsoft, which recently announced it is on track to spend $80 billion on AI data centers, said in a recent blog post that the company’s success depends on “new partnerships founded on large-scale infrastructure investments.” In an interview with Bloomberg, Altman said that he believes it is urgent that what he perceives as barriers to building additional data center infrastructure in the U.S. be cleared.
“The thing I really deeply agree with [President Trump] on is, it is wild how difficult it has become to build things in the United States,” Altman said in that interview. “Power plants, data centers, any of that kind of stuff. I understand how bureaucratic cruft builds up, but it’s not helpful to the country in general.”
Massive data center projects have vocal critics who say that data centers often create fewer jobs than promised and tend to have severe environmental impacts. Data centers are typically water hungry, placing a strain on regions with insufficient water resources, and their high power requirements have forced some utilities to lean heavily on fossil fuels.
Those concerns don’t appear to be slowing investments any. Per a McKinsey report, capital spending on procurement and installation of mechanical and electrical systems for data centers could eclipse $250 billion in the next five years.
In January, Trump announced that Hussain Sajwani, an Emirati billionaire businessman who founded the property development giant DAMAC Properties, will invest $20 billion in new data centers across the U.S. Industry insiders have expressed skepticism of the deal’s concreteness, however.
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Alongside its big public push for AI investments, the U.K. government is also playing a virtual card to catapult itself into the 21st century. Today it announced plans to launch a secure digital wallet to manage government-issued credentials, alongside a chatbot — built in collaboration with OpenAI — to interact with the main GOV.UK portal. Today, it dubbed the chatbot ‘chat-uk’ and said it will be a part of a wider portal and app.
The first two cards it plans to add to its wallet will be a virtual driver’s license, and a virtual veteran card for people who have served in the military. It plans to launch the service later this year, it said in a press conference today. The GOV.UK portal will be online in 2025, but it has already started testing the chat service, and it’s also already opening up for ordinary users to test it, said Peter Kyle, the U.K.’s Secretary of State for technology — even if some of the responses a little odd.
“It is really important the public start to understand that increasingly, in an online world, and government is moving to an online world, that we will interact at an earlier stage so that we can use the power, the insight, and the volume of interactions that the public can provide in testing,” Kyle said in a press conference today in London. “So yes, the chat system did start talking French midway through a testing series, but it was a mistake we learned from.”
The developments come at a crossroads for AI advances.
On one hand, the Labour government has doubled down on the idea of building out an AI economy in the country. Partnerships with private AI companies to invest more in their operations here, more infrastructure such as data centres and a supercomputer to support AI services, and a big commitment from the government to invest in AI services itself. First up, today it unveiled a raft of new AI tools, all still in development: a multi-functional AI assistant for government employees called “Humphrey”; a push to build more consumer-facing AI tools; and more data sharing between government departments to help them build and run AI services.
On the other hand, there remain many questions about how AI services will work in the years ahead. It was only a year ago that the U.K. took a leading role only a year ago in a wider global conversation about AI safety: how the new wave of services being built by companies like OpenAI, Anthropic, Mistral and many others will impact jobs, user privacy and data protection, copyright, and how AI might get misused for nefarious purposes such as to create misinformation, in aid of malicious hacking, and more.
Today, Kyle claimed that in its testing of its new chatbot, there “hasn’t been a single instance” of the chatbot yet being “jailbroken” or returning false information in its “heavy” testing so far.
A push for more digital services in the U.K. comes at the same time as the U.S. is also doubling down on the role tech will be playing in that country. Yesterday, President Trump, on his first day in office, made official his new government “efficiency” effort, dubbed DOGE and led by technology entrepreneur Elon Musk. Trump also repealed an executive order from his predecessor President Joe Biden that sought to reduce AI risks to government, consumers, and businesses. That means that setting up and running safety tests around AI systems are no longer required.
The government said that its new GOV.UK Wallet allows users to securely store government-issued documents on their phone and use them easily when needed, it said. This could be more convenient when, say, you are on the move, and you want to only have a phone and no physical wallet.
The digital driving license, Kyle said today, will also be used to improve online and offline safety. In one example, he described how digital IDs could be used to provide age verification for certain online services, which has been problematic to secure to date. Notably, the U.K. is not exactly ahead of the game here. France has been offering a digital identity app since 2022.
“The technology will make use of security features that are built into modern smartphones, including facial recognition checks similar to those used when people pay using a digital bank card,” it said. “It means that digital documents will be more secure, even if a device is lost.”
There are no plans to make its digital wallet or other digital services compulsory, Kyle added, but he said they are working on the “compelling” and “desirable” nature of the services to get people to use them.
“Why can’t we aspire to have a satisfactory experience where people engage at the moment,” he said.
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OpenAI may be close to releasing an AI tool that can take control of your PC and perform actions on your behalf.
Tibor Blaho, a software engineer with a reputation for accurately leaking upcoming AI products, claims to have uncovered evidence of OpenAI’s long-rumored Operator tool. Publications including Bloomberg have previously reported on Operator, which is said to be an “agentic” system capable of autonomously handling tasks like writing code and booking travel.
According to The Information, OpenAI is targeting January as Operator’s release month. Code uncovered by Blaho this weekend adds credence to that reporting.
OpenAI’s ChatGPT client for macOS has gained options, hidden for now, to define shortcuts to “Toggle Operator” and “Force Quit Operator,” per Blaho. And OpenAI has added references to Operator on its website, Blaho said — albeit references that aren’t yet publicly visible.
Confirmed – the ChatGPT macOS desktop app has hidden options to define shortcuts for the desktop launcher to “Toggle Operator” and “Force Quit Operator” https://t.co/rSFobi4iPN pic.twitter.com/j19YSlexAS
— Tibor Blaho (@btibor91) January 19, 2025
According to Blaho, OpenAI’s site also contains not-yet-public tables comparing the performance of Operator to other computer-using AI systems. The tables may well be placeholders. But if the numbers are accurate, they suggest that Operator isn’t 100% reliable, depending on the task.
OpenAI website already has references to Operator/OpenAI CUA (Computer Use Agent) – “Operator System Card Table”, “Operator Research Eval Table” and “Operator Refusal Rate Table”
Including comparison to Claude 3.5 Sonnet Computer use, Google Mariner, etc.
(preview of tables… pic.twitter.com/OOBgC3ddkU
— Tibor Blaho (@btibor91) January 20, 2025
On OSWorld, a benchmark that tries to mimic a real computer environment, “OpenAI Computer Use Agent (CUA)” — possibly the AI model powering Operator — scores 38.1%, ahead of Anthropic’s computer-controlling model but well short of the 72.4% humans score. OpenAI CUA surpases human performance on WebVoyager, which evaluates an AI’s ability to navigate and interact with websites. But the model falls short of human-level scores on another web-based benchmark, WebArena, according to the leaked benchmarks.
Operator also struggles with tasks a human could perform easily, if the leak is to be believed. In a test that tasked Operator with signing up with a cloud provider and launching a virtual machine, Operator was only successful 60% of the time. Tasked with creating a Bitcoin wallet, Operator succeeded only 10% of the time.
OpenAI’s imminent entry into the AI agent space comes as rivals including the aforementioned Anthropic, Google, and others make plays for the nascent segment. AI agents may be risky and speculative, but tech giants are already touting them as the next big thing in AI. According to analytics firm Markets and Markets, the market for AI agents could be worth $47.1 billion by 2030.
Agents today are rather primitive. But some experts have raised concerns about their safety, should the technology rapidly improve.
One of the leaked charts shows Operator performing well on selected safety evaluations, including tests that try to get the system to perform “illicit activities” and search for “sensitive personal data.” Reportedly, safety testing is among the reasons for Operator’s long development cycle. In a recent X post, OpenAI co-founder Wojciech Zaremba criticized Anthropic for releasing an agent he claims lacks safety mitigations.
“I can only imagine the negative reactions if OpenAI made a similar release,” Zaremba wrote.
It’s worth noting that OpenAI has been criticized by AI researchers, including ex-staff, for allegedly de-emphasizing safety work in favor of quickly productizing its technology.
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