Amazon.com Inc. plans to invest nearly $150 billion in data centers over the next 15 years to cope with the expected surge in demand for artificial intelligence applications and other digital services. This move is a sign of strength as the company seeks to maintain its dominance in the cloud services market where it holds about twice as much market share as runner-up Microsoft Corp.
Amazon's Planned Investment in Server Farms Far Exceeds the Public Commitments of Microsoft and Alphabet Inc.'s Google, Although Neither Company Has Disclosed Data Center Spending as Transparently as Amazon. Spokespeople for Microsoft and Google Declined to Provide Comparable Figures.
Amidst Wider Cost Cuttings at Amazon, AWS's Capital Expenditures for Data Centers Shrank by 2% for the First Time in 2023, Even as Microsoft Increased its Own Spending by More Than 50%. However, Amazon's CFO Said Last Month that Capital Expenditures Would Increase This Year to Support AWS's Growth, Including AI-related Projects.
"Amazon plans to expand existing server farm hubs in North Virginia and Oregon and to penetrate new areas such as Mississippi, Saudi Arabia, and Malaysia. In the last two years, Amazon has committed to spending 148 billion dollars worldwide for the construction and operation of data centers."
The expansion of data centers is not only aimed at meeting the increase in demand for corporate services such as file storage and databases, but will also provide the massive computing power required for an expected boom in generative artificial intelligence.
Amazon plans to invest tens of thousands of millions of dollars in Virginia and Oregon, but securing electricity is becoming increasingly difficult. Data centers require a lot of energy, and their growing ubiquity is putting pressure on utility companies.
Facing Resistance to Data Centers, Amazon also Focuses on Constructing New Facilities in Other Parts of the USA and Collaborates with Utility Companies to "Meet Our Energy Needs with Renewable, Carbon-Free Energy."
Amazon has committed to powering all its operations with renewable electricity by 2025, but these projects can be far from its data centers, a mismatch between supply and demand that plagues the fragmented and aging US power grid.
