Microsoft and BlackRock want to raise $100 billion to ’emancipate themselves from the shackles’ of insufficient power and increase data centers for their ambitious AI dreams

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Microsoft and BlackRock want to raise $100 billion to 'emancipate themselves from the shackles' of insufficient power and increase data centers for their ambitious AI dreams

What you need to know

  • Microsoft and BlackRock have partnered to raise $30 billion to satisfy their AI needs, including new data centers and sufficient power supply.
  • BlackRock’s CEO admits AI efforts are expensive and could require multi-trillions of dollars to finance when building data centers worldwide.
  • Microsoft CEO Satya Nadella says the initiative will expedite gathering resources to “build the infrastructure of the future and power it in a sustainable way.”

As a tech enthusiast with over two decades of experience under my belt, I find myself both awestruck and concerned by the latest developments in the AI landscape. The partnership between Microsoft and BlackRock to raise $30 billion for data centers and energy infrastructure is nothing short of monumental. It’s a testament to the growing importance of AI in our world, but it also highlights an issue that has been looming on the horizon for quite some time – the lack of sufficient power to drive these advancements.

Did you know Google and Microsoft consume more power than 100 countries? Generative AI’s electricity and cooling water demand is at an all-time high. Experts and researchers say the world might be on the brink of the most significant technological breakthrough with AI, but there won’t be enough electricity to power its advances by 2025.

Leading figures in the AI sector, such as OpenAI and Microsoft, are actively exploring renewable energy sources, including nuclear fusion, in an effort to maintain the momentum of their AI-related projects without being hindered by insufficient power supply. Interestingly, Microsoft and BlackRock have joined forces with a goal to amass $30 billion for establishing data centers dedicated to their AI initiatives as well as the energy systems required to run them.

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Microsoft and BlackRock are members of the Global Artificial Intelligence Infrastructure Investment Partnership (GAIIP) along with other Global Infrastructure Partners (GIP). These partners focus on investing, managing ownership, and operating significant assets across sectors such as energy, transportation, digital infrastructure, and others.

GAIIP intends to gather around $30 billion in private investment funds. With this capital, they anticipate attracting additional investments of up to $100 billion from various investors, such as through debt financing. During an interview, Larry Fink, CEO of BlackRock, hinted at this potential development.

Building data centers worldwide will require trillions of dollars in financing, demonstrating how capital markets construct essential infrastructure and foster new technological possibilities.

According to Microsoft CEO Satya Nadell, this project aims to hasten the acquisition of resources needed to construct the infrastructure for tomorrow and run it in an environmentally friendly manner. Nadell also stated that they are dedicated to using AI to foster innovation and stimulate growth throughout all industries.

Lack of sufficient power continues to cripple in AI advances 

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Microsoft and BlackRock want to raise $100 billion to 'emancipate themselves from the shackles' of insufficient power and increase data centers for their ambitious AI dreams

Lately, many businesses working within the AI sector are expressing a strong commitment to make their endeavors greener, cost-effective, and eco-conscious. This involves constructing large data centers designed for training and enhancing the performance of their artificial intelligence products.

It appears that the increased need for GPUs from NVIDIA is causing a supply-and-demand dilemma. Reports suggest that the chip manufacturer is struggling to meet this high demand, as per leaked emails between Elon Musk and NVIDIA, Musk requested priority processor shipments for X and xAI over Tesla due to the scarcity of AI chips.

Speaking of the same subject, Elon Musk unveiled xAI’s Colossus initiative, a project that was swiftly built in less than 122 days. According to reports, this is currently the world’s most potent AI training system, boasting an impressive 100,000 NVIDIA H100 GPUs. The goal is for it to nurture Grok into the most powerful AI across all metrics.

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In other locations, Microsoft and OpenAI have committed $100 billion to a venture named Stargate, aiming to break free from the constraints and excessive dependence on NVIDIA for AI processors. This data center is slated for launch in 2028 and will cater to the companies’ substantial need for GPUs. However, investors have begun expressing concerns over Microsoft’s significant investment in AI projects, as the profits derived so far are relatively low.

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2024-09-19 18:39