The Wall Street Journal (WSJ) reported on the 18th that Google will set up an artificial intelligence (AI) cloud infrastructure company with private equity (PE) firm Blackstone. The move is seen as a bid to challenge the AI cloud market currently led by CoreWeave and to shake up the Nvidia-centered AI chip ecosystem.
According to the WSJ, the joint venture the two companies are establishing will see Blackstone inject $5 billion (about 7.5 trillion won) as initial capital to secure the largest shareholder position. Google will provide the joint venture with its in-house AI Semiconductor tensor processing units (TPUs) and related software. Google executive Benjamin Treynor Sloss is expected to serve as the joint venture's chief executive officer (CEO).
Until now, Google has provided TPUs only to its own data centers and a few partners, but with the launch of this joint venture, it is expected to sell AI Semiconductors to external customers. To date, Google has agreed to provide about 1 million TPUs to AI corporations Anthropic and has also signed a TPU supply deal with Meta, Facebook's parent company.
The joint venture is expected to directly compete with AI infrastructure corporation CoreWeave. CoreWeave is a so-called "neo-cloud" corporation that secured Nvidia graphics processing units (GPUs) at scale and built AI cloud infrastructure on that base to offer to corporate customers. As AI demand has surged over the past year, major AI corporations are relying on CoreWeave's infrastructure.
Google and Blackstone aim to secure 500 megawatts (MW) of power capacity by next year. That is enough electricity to run a mid-sized city. The WSJ said the two companies have already selected data center sites, and some are currently under construction.
Blackstone is one of the most aggressive Wall Street managers investing in AI. In 2021, it acquired data center operator QTS Realty Trust, and in 2024 it bought data center corporation AirTrunk. Including projects currently under construction, it holds $150 billion in data center asset.