Microsoft, BlackRock form group to raise $100 billion for AI data centers

Microsoft and BlackRock are leading a group of investment companies with plans to plow up to $100 billion into the development of data centers for artificial intelligence and the energy infrastructure to power them.

The AI partnership – which the group is calling the Global AI Infrastructure Investment Partnership (GAIIP) – also includes Global Infrastructure Partners (which BlackRock is in the process of acquiring) and Abu Dhabi-backed investment company MGX.

The partnership aims to assemble $30 billion of private equity capital initially, with a future goal to bring in up to $100 billion in total investment, including from debt financing.

“The capital spending needed for AI infrastructure and the new energy to power it goes beyond what any single company or government can finance,” said Brad Smith, vice chair and president of Microsoft, in a statement. “This financial partnership will not only help advance technology, but enhance national competitiveness, security, and economic prosperity.”

AI-oriented data centers have been the talk of the industry lately, with hyperscalers and startups alike looking to build data centers full of Nvidia GPUs that can run generative AI models, such chatbots like OpenAI’s ChatGPT. But those GPUs consume far more power than your typical data center, and they are already power constrained.

Nvidia announced it will support GAIIP, offering its expertise in AI data centers and AI factories to benefit the AI ecosystem. GAIIP will also engage industry leaders to help enhance AI supply chains and energy sourcing for the benefit of its customers and the industry, the group said.

MGX was formed in Abu Dhabi earlier this year to address this problem and develop AI infrastructure. In addition to investing in AI technologies and startups, the company is also focused on building AI infrastructure like data centers, fostering partnerships between technology firms, research institutions and governments, and providing education and technical training for AI research professionals.

“Installed data center capacity today exceeds 70 gigawatts. Over the next 10 to 15 years, this number is expected to reach 300 gigawatts. Currently, 1 gigawatt costs about $30 billion to $35 billion, making this level of spending unprecedented in both scope and scale,” Ahmed Al Idrissi, CEO of MGX, told The National at the deal signing ceremony in Washington, DC.

“Even hyper-scalers today are spending around $200 billion to $250 billion annually on infrastructure, but they can no longer sustain this level of expenditure moving into the next decade. Therefore, we have come together to create an investment vehicle that can help bear some of this burden and offer infrastructure delivery as a service to various players across the market,” he added.

MGX’s founding partner is G42, a technology holding company that has previously partnered with Microsoft and along with Cerebras has built what it claims is the fastest supercomputer in the world at 36 Exaflops.

Read more AI data center news

• AI, 5G and IoT spur edge data centers
• AI drives 25% surge in data center systems spending
• Cost, AI, and staffing are biggest concerns for data centers
• AI is wild card in data center energy demand, say electricity researchers
• Cisco aims AI advancements at data center infrastructure