- Bloomberg Reports Microsoft does not go ahead with more data center projects all over the world
- It is the third report that claims Microsoft’s more cautious approach to its data center projects
- There are indications that we are on the verge of seeing a global capacity glut when it comes to data centers
The global stock markets are in turmoil right now as President Donald Trump’s tariffs are starting to come into force – but that’s not the only problem that the Big Tech companies are facing.
Microsoft is now in focus for a third Bloomberg Report detailed withdrawals about its AI Data Center plans, thereby the fresh questions about how engaged the US tech giant remains to his current level of investment in AI infrastructure.
While Microsoft is maintaining, it will spend about $ 80 billion on data centers in this financial year, it has acknowledged that growth will slow down after that. The future focus will change from new construction to the equipment existing infrastructure with servers and AI equipment.
Still on the track to spend $ 80 billion
Bloomberg Microsoft claims have left or break data center projects in several regions.
In the UK, it stepped away from a potential lease near Cambridge, which was marketed to host advanced Nvidia chips.
In Indonesia, parts of a data center campus an hour outside Jakarta have been put on hold.
In North Dakota, conversations drew for so long with a potential tenant that Microsoft lost exclusivity, and the expansion has also subsided in Wisconsin, where the company had already spent $ 262 million on construction, including nearly $ 40 million on concrete.
Microsoft also recently drew out of a plan to rent an additional $ 12 billion data center capacity from Coreweave. Openai stepped in to connect this hole, but since Microsoft is Openai’s biggest funding, it probably used Microsoft’s own money to do so.
Some of the caution may come from signs that AI workloads are becoming less calculating than expected, thanks to any minor part of the “Deepseek effect” where the Chinese AI start-up demonstrated performance compared to Openai with far fewer resources. This has led to some investors questioning whether the current construction rate may be justified.
Meanwhile a separate report from My Technology Review shows the extent of overcapacity in China.
The government that quickly asked more than 500 data centers-building projects, with at least 150 completed by the end of 2024, but estimated 80% of these new AI data center resources are unused.
Together, these developments suggest that Big Tech’s data centers -ambitions can surpass the current demand for AI services, at least for now, which begins to encourage caution among investors and industrial insiders.
