Global Artificial Intelligence Infrastructure Investment Partnership is to allocate $30 billion to build new and upgrade existing data centers. The rest of the amount will go to energy infrastructure supporting the implementation of artificial intelligence.
The aforementioned partnership is an interesting combination of the activities of a leading technology company with a financial industry giant that is the largest asset manager in the world. BlackRock is described by many analysts as the most powerful financial entity in the world, which has enormous political influence.
The group will also include Global Infrastructure Partners, an infrastructure investor being taken over by BlackRock and technology investor MGX from the United Arab Emirates – we read on CNBC.
The $30 billion is to be the initial capital, with the remainder to be acquired later. Part of the venture will be financed with debt.
BlackRock intends to acquire Global Infrastructure Partners for $3 billion in cash and about 12 million of its own shares. The transaction is expected to close on October 1. MGX was formed in March of this year by Mubadala and Abu Dhabi-based G42.
Big Tech Invests in AI
This is another large capital investment Microsoft in the AI industry, which is part of a broader race between the largest investment companies. The lion’s share of spending Microsoft, Amazon and Google is used to expand their huge data centers (Microsoft Azure, Amazon Web Services and Google Cloud, respectively), which requires expensive graphics processing units (GPUs) obtained mainly from Nvidia.
Large language models and other AI tools require much more advanced hardware than older systems, which requires huge capital expenditures. Microsoft’s CAPEX in the fourth quarter of the fiscal year was $19 billion. The biggest beneficiary of the AI revolution is Nvidia, which controls more than 90 percent of the GPU market for modern data centers.
