Elon Musk slams Trump-backed AI mega project
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US billionaire Elon Musk (centre) attending US President Donald Trump’s inauguration on Jan 20.
PHOTO: REUTERS
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WASHINGTON - Tech titan Elon Musk cast doubt on Jan 22 on a US$500 billion (S$677 billion) AI project announced by US President Donald Trump, saying the money promised for the investment actually was not there.
The comments marked a rare instance of a split between the world’s richest man and Mr Trump, with Mr Musk playing a key role in the newly installed administration after spending US$270 million on the election campaign.
In his first full day in the White House, Mr Trump on Jan 21 announced a major investment
Mr Trump said the venture, called Stargate, “will invest US$500 billion, at least, in AI infrastructure in the United States”.
But in a post on his social media platform X, Mr Musk said the main investors “don’t actually have the money”.
“SoftBank has well under US$10 billion secured. I have that on good authority,” Mr Musk added in a subsequent post.
‘Wrong’
Mr Musk’s sideswipe could be particularly targeted at OpenAI, the world’s leading AI start-up that Mr Musk helped found, before leaving in 2018.
The Tesla boss and OpenAI chief executive Sam Altman, who was present at the White House on Jan 21, have been mired in a serious feud, with Mr Musk opening repeated lawsuits against the company behind ChatGPT.
“Wrong, as you surely know. Want to come visit the first site already under way?“ Mr Altman replied to Mr Musk on X.
“This is great for the country. I realise what is great for the country isn’t always what’s optimal for your companies, but in your new role I hope you’ll mostly put (country) first,” he added.
OpenAI is one of the world’s highest valued start-ups, but loses money on the high costs of turning out its expensive technology.
According to The Wall Street Journal, cloud giant Oracle, which is also involved, has about US$11 billion in cash and securities. SoftBank has roughly US$30 billion of cash on hand.
“The American people should take President Trump and those CEOs words for it. These investments are coming to our great country and American jobs are coming along with them,” Mr Trump’s spokeswoman Karoline Leavitt told Fox News.
The Stargate project is committed to invest an initial US$100 billion in the project, and up to US$500 billion over the next four years.
Abu Dhabi’s AI-focused state fund MGX and Oracle are also providing funding for the project, while SoftBank-owned Arm, Microsoft and Nvidia will be technology partners.
According to the companies, the project is initially building a data centre operation in Texas, where construction is already under way.
Ahead of taking office, Mr Trump in January unveiled a US$20 billion Emirati investment in US data centres, as well as a previous investment pledge from SoftBank.
‘Immediately’
SoftBank, headed by flamboyant Japanese tycoon Masayoshi Son – who announced Stargate on Jan 21 with Mr Trump, Mr Altman and Oracle boss Larry Ellison – declined to comment.
In its statement on Jan 21, the Japanese investment group said it would “begin deploying US$100 billion immediately” for the project.
The firm’s shares were up around six per cent on Jan 23, having added more than 10 per cent on Jan 22.
Technology news outlet Information said that SoftBank and OpenAI each plan to commit US$19 billion of capital to Stargate, Bloomberg News reported.
The two companies would then both own 40 per cent of it, the Information said, citing comments by Mr Altman to colleagues.
It added that Oracle and MGX would contribute about US$7 billion apiece, with the rest of the money coming from limited partners and debt financing.
Mr Son, 67, founded SoftBank in his 20s. He made spectacularly successful early bets on Yahoo! and Alibaba but also some disastrous investments such as in WeWork.
In Mr Trump’s first term, the rags-to-riches investor promised SoftBank would invest US$50 billion in the United States and create 50,000 jobs.
Appearing alongside the then US president-elect in December, Mr Son said he would now “double down” with US$100 billion and generate employment for 100,000 Americans. AFP
