Google and Blackstone plan new AI cloud group with $5bn backing

In short: Google and Blackstone are forming a new AI cloud group backed by an initial $5bn commitment from Blackstone.

What happened

Google and Blackstone are creating a new venture focused on AI computing, according to a person familiar with the matter. Blackstone is expected to make an initial commitment of $5bn.

The group aims to bring 500 megawatts of data center capacity online next year. A data center is a large building filled with computers that run online services, like a warehouse full of machines instead of boxes.

The venture is meant to help expand the reach of Google’s specialized chips, which are the processors used to run AI tasks. You can think of these chips as purpose built engines that are designed to handle certain kinds of heavy computing work.

Benjamin Treynor Sloss, a long time Google employee, will lead the new venture. The Wall Street Journal first reported the deal.

Why it matters

AI systems need a lot of computing power, and that power usually comes from data centers that are expensive to build and run. A partnership like this suggests that big tech companies and big investors expect demand for AI computing to keep growing, and they are putting serious money into the infrastructure that makes it possible. For regular people, this can affect how quickly AI features show up in everyday apps and services, and it can also influence local issues like electricity use and where new data centers get built.

Source: Financial Times