Microsoft has huge plans to expand its data center output to fuel AI boom

Microsoft has huge plans to expand its data center output to fuel AI boom

Microsoft is set to triple its datacenter capacity within the next year as a response to the surging demand for artificial intelligence.

The surge in demand for foundation models and generative AI has been exponentially adding to the amount of computing power needed.

Microsoft is now planning to double its Azure capacity in the second half of this financial year (which, confusingly, equates to the first six months of this calendar year), and triple it in the first six months of the next financial year.

Data center demand hits new heights

The news comes from internal documents seen by Insider, which detail the company’s efforts to secure “a record number of GPUs” to bolster its infrastructure for handling AI workloads. Redmond has already doubled its installed base of accelerators in the past year in light of heightened AI demand.

More broadly, the company last year committed to spending billions to address data center and cloud infrastructure.

Though the company has not explicitly confirmed concrete plans, observations of the company align with the reported intent to grow its data center footprint. A real estate job ad posted earlier this year alluded to the company’s plans to expand its footprint in the Asia-Pacific region.

The latest Synergy research claims over half (51%) of all data center capacity was located in the US. Another quarter (26%) was located in the Asia-Pacific region, however China accounted for nearly two-thirds (62%) of that quota. Europe lagged behind, accounting for 17% of all capacity.

Looking ahead, the market analytics firm expects data center capacity to double in four years, with generative AI emerging as the driving factor.

TechRadar Pro has asked Microsoft to confirm plans to expand its data center footprint, but the company did not immediately respond.

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Craig Hale

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