Amazon Follows Microsoft in Retreat From Ambitious AI Data Center Plans

The number of tech giants paring back on their AI data center plans rises to two. According to banks Wells Fargo and TD Cowen, Amazon has paused negotiations on some co-location data center deals, primarily in Europe. The news comes shortly after several reports have indicated Microsoft has paused or cancelled some of its plans. “It’s not clear the magnitude of the pause,” a Wells Fargo report reads, “but the positioning is similar to what we’ve recently heard from MSFT—they are digesting aggressive recent lease-up deals.” It goes on to emphasize that Microsoft still appears to be going through with deals already signed. Co-location is the concept of sharing enormous infrastructure costs by building data in partnership with other companies that need it. It is important to keep in mind that other companies, including Meta and xAI, continue to aggressively build out data centers to fuel their AI models. Building out large-scale data centers requires significant amounts of power, which ... Read full article.