In another move that will enrage the participation-trophy lobby, Microsoft last week loudly and proudly proclaimed it has built the world’s “most-powerful AI data center” just as Oracle and OpenAI revealed their latest plans to build a series of AI data centers of unprecedented scale and power.
This bare-knuckle competition involving Microsoft versus Oracle and OpenAI and SoftBank is a fabulous endorsement of the belief that the AI Revolution will bring enormous benefits to billions of people across the globe.
And while this free-market brawling will surely inspire some people to question the propriety of spending many hundreds of billions — and possibly trillions — of dollars to build the AI factories of the future, I have zero doubt that those latter-day Luddites will surely indulge themselves in the mind-bending benefits that the AI Revolution will offer to every person on Earth.
Those phone displays of virtue-signaling ring even more hollow when we consider the degree to which Microsoft, via Vice Chairman and President Brad Smith, is striving to show that these giant AI factories will not only not boil the Earth but will indeed enrich it and its inhabitants. Here’s Smith from his recent blog post headlined “Made in Wisconsin: the world’s most powerful AI datacenter“:
This facility is a catalyst for economic opportunity. At its peak, we have employed more than 3,000 construction workers during daily peak activity, including electricians, plumbers and pipefitters, carpenters, structural iron and steel workers, concrete workers, and Earth movers. Once our first datacenter is fully operational, we will employ around 500 full-time employees, with that number growing to around 800 once the second datacenter is complete.
We are committed to Wisconsin and other communities that host our cutting-edge datacenters, creating hubs for AI innovation where local businesses, nonprofits, students, and workers can all benefit from the growing AI economy. That’s why we partnered in Racine with Gateway Technical College to launch Wisconsin’s first Datacenter Academy, training more than 1,000 students in five years for high-demand datacenter roles. Across the state, Microsoft and more than 40 partners like the United Way, the University of Wisconsin, and the Wisconsin Technical College System have worked together and with Gener8tor to train 114,000 people in AI — including 1,400 people living in Racine County.
We’ve also sponsored and helped to open the nation’s first manufacturing-focused AI Co-Innovation Lab on the campus of the University of Wisconsin-Milwaukee. It results from a partnership with UW-Milwaukee, WEDC, Gateway Technical College, and TitletownTech (a partnership between Microsoft and the Green Bay Packers). The lab has already helped 23 Wisconsin companies — including Regal Rexnord, Renaissant, and BW Converting — turn AI ideas into real solutions. A few of these companies are headquartered right in Racine County, like Wiscon Products, a family-owned precision machining company founded in 1945.
Heck, on top of all that, Microsoft has come up with a suitably eco-fuzzy name for its new generation of AI data centers: “Fairwater.”
Don’t be bashful: celebrate this incredible innovation and scale!
Check out some of these details from a recent blog post by Microsoft’s Scott Guthrie, Executive Vice President for AI and cloud:
Modern datacenters can contain exabytes of storage and millions of CPU compute cores. To support the AI infrastructure cluster, an entirely separate datacenter infrastructure is needed to store and process the data used and generated by the AI cluster. To give you an example of the scale — the Wisconsin AI datacenter’s storage systems are five football fields in length!
And here’s a photo of that storage facility from Microsoft.com:
(Source: Microsoft.com blog post)
Meanwhile, Oracle and Stargate surge forward
While OpenAI continues to do a great deal of business with Microsoft — its original big-time partner — OpenAI is preparing to pour $300 billion into its partnership with Oracle to build comparably sized AI data centers. Here’s some of what OpenAI CEO Sam Altman had to say about the next phase of his company’s extraordinary engagement with Oracle to build out the infrastructure that will support the AI Revolution:
OpenAI, Oracle, and SoftBank are announcing five new U.S. AI data center sites under Stargate, OpenAI’s overarching AI infrastructure platform. The combined capacity from these five new sites — along with our flagship site in Abilene, Texas, and ongoing projects with CoreWeave — brings Stargate to nearly 7 gigawatts of planned capacity and over $400 billion in investment over the next three years. This puts us on a clear path to securing the full $500 billion, 10-gigawatt commitment we announced in January by the end of 2025, ahead of schedule.
In July, OpenAI and Oracle entered an agreement to develop up to 4.5 gigawatts of additional Stargate capacity. This represents a partnership that exceeds $300 billion between the two companies over the next five years. The three new sites — located in Shackelford County, Texas; Doña Ana County, New Mexico; and a site in the Midwest, which we expect to announce soon; combined with an additional potential expansion of 600 megawatts near the flagship Stargate site in Abilene, Texas — can deliver over 5.5 gigawatts of capacity. Together, these sites are expected to create over 25,000 onsite jobs, and tens of thousands of additional jobs across the U.S. We remain in the process of evaluating additional sites.
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Oracle chairman Larry Ellison has frequently said that Oracle intends to build the world’s largest AI data centers, and to have more cloud and AI regions than all of its hyperscaler competitors combined.
So the stakes in this race for supremacy in the nascent AI data center market could not possibly be higher — as is the case for the potential benefits to humankind.
Final Thought
While I fully realize the world is full of all kinds of different people with all different kinds of ideas about what’s important and what’s trivial, I’m always amazed to see the tendency among some folks to whine and moan about the astonishing levels of effort and ingenuity and heart and soul and money that some other people want to invest in making the world a better place.
But medical breakthroughs and productivity enhancements and scientific enlightenment and enhanced food production don’t just pop up out of the ether. So as Microsoft and Oracle/OpenAI/Stargate continue to pour hundreds of billions of dollars into the AI factories that will power the AI Revolution, all I can say is bravo — and may you both win, and win big!
