Microsoft takes over Texas data center after OpenAI backs away

Microsoft is taking over a data center construction project in Abilene, Texas, after OpenAI declined to expand further. The two companies will now be neighbors at one of the nation's largest AI computing complexes.

Data center developer Crusoe is working with Microsoft to build two new AI factory buildings and an on-site power plant, right next to where Crusoe has been building an even larger computing campus for OpenAI and Oracle.

OpenAI's existing project is the flagship of the Stargate initiative, so massive that President Trump personally announced it after his inauguration. Microsoft was once OpenAI's exclusive cloud provider and still holds a roughly 27 percent stake, but the two companies are increasingly pursuing AI development separately.

Crusoe has already completed two buildings for OpenAI and Oracle, with six more under construction due by year-end. Microsoft's new project includes a power plant expected to generate 900 megawatts.

This underscores the increasingly complex relationship between Microsoft and OpenAI. They're on the same plot of land but operating independently. For enterprise customers, this means more capacity and more options in AI infrastructure.