Japan’s Bold Move: Building a Data Center to Challenge OpenAI’s Stargate
Japan is throwing its hat into the AI infrastructure ring—and aiming straight for the top.
Forget playing catch-up. The country is reportedly planning a massive data center project designed to compete directly with OpenAI's ambitious Stargate initiative. This isn't about building another server farm; it's a strategic play for technological sovereignty in the age of artificial intelligence.
The Geopolitics of Compute
Nations are waking up to a simple truth: whoever controls the computational horsepower controls the AI race. OpenAI's Stargate project, rumored to cost a staggering sum, represents a private-sector moonshot for unprecedented scale. Japan's counter-move signals a shift. It's a declaration that critical AI infrastructure is too important to be left solely in the hands of a few Silicon Valley giants—or their increasingly volatile venture capital backers.
More Than Just Hardware
The plan cuts deeper than raw processing power. It's about creating an ecosystem. Expect a focus on energy efficiency, possibly leveraging Japan's expertise in cooling and precision engineering. The goal is to build not just a competitor, but an alternative model—one that might prioritize stability and long-term planning over the breakneck, 'growth-at-all-costs' ethos that defines much of the tech world. After all, what's the point of building a digital brain if it's powered by the financial equivalent of sugar rushes and caffeine crashes?
This is Japan betting big on its own technological future. The data center war is heating up, and a new front just opened in the Pacific.
What makes Nanto an ideal location?
Nanto has several things working in its favor. The city is about 250 kilometers from Tokyo and Osaka. That’s close enough to reach the big population centers without being right on top of them. But the bigger selling point is safety. Toyama is among the prefectures with the fewest big earthquakes, according to the Japan Meteorological Agency.
The first phase of the Nanto Campus will support about 400 megawatts of power. That’s equal to some of Japan’s largest data centers announced so far. It can handle big operators like Amazon, Microsoft, and Google.
The site will be up and running by the end of 2028, based on the public-private plan.
GigaStream Toyama focuses on getting infrastructure ready for data center operators to use. It’s similar to what U.S.-based companies Lancium and Tract do. The company plans to start promoting the Nanto Campus at next month’s Pacific Telecommunications Council conference in Honolulu.
Daniel Cox heads up GigaStream Toyama. He’s spent 25 years in Japan’s real estate investment market.
Officials at both Nanto city and GigaStream Toyama wouldn’t comment when asked. They said they’ll make an announcement soon according to Reuters.
Market’s Growing Fast
Cloud and AI services are pushing Japan’s data center market to grow fast. IDC Japan forecasts the market will almost double to more than 5 trillion yen in the five years through 2028. That’s $32 billion.
The government’s counting on this sector to help hit its goal of bringing in 120 trillion yen in foreign direct investment by 2030. That’s up from 53.3 trillion yen in 2024.
Power’s more abundant and generally cheaper in western Japan compared to the east. Multiple utilities service the area – Hokuriku Electric Power, Kansai Electric Power, and Electric Power Development, along with smaller operators.
Hokuriku Electric sells less than half of its maximum output even without its idled Shika nuclear power plant running.
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