In the midst of an artificial intelligence space race, China’s cutting-edge data center buildout highlights a nation that’s preparing for market dominance. But what does it mean for the Asian powerhouse’s pure-play AI stocks?
Bloomberg has reported on an ambitious AI data center strategy that’s being planned in Beijing, which would see around 2 trillion yuan ($295 billion) allocated to build out a nationwide infrastructure over the next five years. Led by the National Development and Reform Commission, the buildout is expected to link computing facilities nationwide into an integrated network.
Critically, the plans will focus largely on using local suppliers to provide the technology required, opening the door to brand new growth opportunities for China’s artificial intelligence leaders. That could have a lasting impact on domestic tech stocks.
The initiative would lean heavily on China Mobile and China Telecom, both of which would take on the primary responsibility for running the facilities and maintaining connectivity between them.
Beyond that, at least 80 percent of the hardware and software, including AI chips, that will be used within the data centers will come from Chinese vendors, with private firms like Huawei Technologies expected to become a key beneficiary of the project. This would leave global artificial intelligence giants like Nvidia and Advanced Micro Devices (AMD) out of the loop.
