The $100 Billion Partnership
OpenAI and Nvidia recently announced a partnership to build one of the largest AI infrastructures in history. The plan: deploy up to 10 gigawatts of Nvidia systems by 2030. For context, that’s about the energy output of ten standard nuclear power plants. The first gigawatt is expected to go online in the second half of 2026.
This is not just another data center expansion. OpenAI will rely on Nvidia’s Vera Rubin platform to scale beyond anything currently available. At this level, the infrastructure becomes both a technological marvel and a societal challenge.
Nvidia secures its role as the backbone of AI computing, cementing its dominance through GPUs and the CUDA ecosystem. For OpenAI, this move reduces dependence on Microsoft’s Azure while ensuring it has the compute capacity needed for the next generation of models. Nvidia’s stock price immediately surged, signaling just how high the stakes are.
The Environmental Question
My first thought: what does this mean for the environment and for people living near these facilities? Ten gigawatts of power is massive, requiring energy on a scale we usually associate with national infrastructure, not private companies.
The push for more powerful AI makes sense from a business perspective. Training larger models requires exponentially more processing power. But as we race forward, society hasn’t caught up. Regulations are lagging, and environmental impact is rarely front and center in these announcements. We need to ask: are we ready for the consequences of building AI infrastructure that consumes as much energy as a small country?
Where Does This Leave Microsoft?
This is where things get complicated. Microsoft has poured billions into OpenAI, baking its technology into nearly every product. Copilot is their flagship AI layer, spanning Office, Teams, Windows, GitHub, and Azure. Yet, Microsoft was reportedly notified late about the Nvidia deal. A signal that their exclusive influence is fading.
On paper, Microsoft still holds important advantages:
- A long-term hosting agreement with OpenAI through Azure (until at least 2030).
- Rights of first refusal on new compute capacity.
- Deep product integration that makes unwinding the relationship nearly impossible in the short term.
OpenAI is diversifying. By partnering with Nvidia directly, it gains bargaining power and the freedom to explore other alliances. Microsoft, once the default partner, is now just one of several.
The Lawsuit Problem
The other cloud hanging over Microsoft is legal risk. Both Microsoft and OpenAI are named in multiple lawsuits from copyright infringement claims by publishers like The New York Times, to class actions alleging privacy violations in data collection.
If courts side with the plaintiffs, the damages could reach billions. Worse, Microsoft may have to fundamentally change how it deploys GPT-based services, limiting features or paying ongoing licensing fees for training data. That’s not just an operational headache. It would be a strategic shift.
Microsoft risks being chained to OpenAI’s legal troubles at a time when it’s betting the future of its products on Copilot. Every lawsuit adds pressure for Microsoft to accelerate its own in-house AI efforts. Something it has the money and talent to do, but for now hasn’t fully committed to.
Why Isn’t Microsoft Building Its Own AI?
This is what confuses me most. Microsoft has the resources, the infrastructure, and the incentives to develop its own models. Instead, it keeps layering features on top of OpenAI’s GPT models.
That decision comes with costs. When OpenAI updates GPT, Microsoft has to adapt Copilot, always playing catch-up. When lawsuits target OpenAI, Microsoft is dragged into court alongside them. When OpenAI strikes new partnerships, Microsoft risks losing influence.
It’s possible Microsoft is quietly training models behind the scenes, perhaps tailored to enterprise and legal use cases. Publicly, they’ve tethered themselves to OpenAI in a way that feels increasingly risky.
The Bigger Question
The partnership between OpenAI and Nvidia will push AI into new territory. More power, more scale, more capability. Also: more energy demands, more legal fights, and more strategic uncertainty for companies like Microsoft.
The central question remains: are we, as a society, ready for a more powerful AI? Technology is sprinting ahead, while the legal and environmental frameworks limp behind. Microsoft’s dependence on OpenAI highlights the risks of betting everything on a partner it doesn’t control.
OpenAI and Nvidia’s $100B partnership could reshape the AI industry, but it also sharpens the dilemmas we face. The world will gain access to more advanced AI, but the cost will be measured in energy, lawsuits, and corporate power struggles. For Microsoft, the lesson is clear: reliance on someone else’s AI may be the biggest risk of all.
