How Big Tech is offloading the risks of the AI boom

Moves let firms like Meta and Microsoft add computing power quickly and then wait to see how demand for AI shapes up

- Karen Weise and Eli Tan

Data centres owned and operated by Amazon Web Services in Ashburn, Virginia. Three Democratic senators said last week that they are investigating whether and how the operations of technology companies are driving up residential electricity bills. —Nathan Howard/ The New York Times

(Nathan Howard/ The New York Times)

This fall, Microsoft announced a series of deals, totaling tens of billions, to lease computer power for its artificial intelligence ambitions. Meta secured almost $30 billion in financing to build a massive data centre in Louisiana without taking on the debt itself. Google also committed to rent computing power from a small company and then sell some of it to OpenAI.

Those deals had one thing in common: They allowed companies that make massive quarterly profits to reduce their financial exposure to the frenetic, global buildup of data centres.

They also signalled new ways the biggest companies in tech are maneuvering to push some of the risk of the AI boom onto the shoulders of upstarts eager for a piece of the action. The moves let companies like Meta and Microsoft add computing power quickly and then wait to see how demand for AI shapes up before committing to projects that can last for decades.

Trillions of dollars are at stake as tech companies try to predict how much computing power AI will demand years down the line. If the big companies decide they don't really need all that computing after the deals are over, the smaller companies and their lenders will be stuck with the consequences.