The data center crunch is pushing AI companies to look abroad

The growing demand for artificial intelligence is creating a major need for electricity, computer chips and data centers, but increasing opposition from U.S. communities is making it harder for AI companies to expand domestically, The New York Times reports. 

As more communities oppose data centers because of concerns about their local impacts, along with cancellations and moratoriums, companies are increasingly looking overseas for computing capacity. One example is Together AI, a U.S.-based startup valued at $8.3 billion, which recently partnered with Saudi Arabia’s Humain. 

Through the agreement, Together AI will receive 250 megawatts of electricity and 120,000 semiconductors from a Saudi-based data center, roughly tripling its current data center capacity. 

Together AI expects the data center to generate about $5 billion in annual business. Humain, which was started by Crown Prince Mohammed bin Salman, is investing heavily in AI infrastructure as part of Saudi Arabia’s effort to develop its AI industry and diversify its economy beyond oil. 

Humain plans to supply 6 gigawatts of power by 2034 through projects estimated to cost $77 billion. The company has also partnered with Amazon Web Services, Luma AI and xAI and plans to purchase chips from Nvidia, AMD and Qualcomm. 

Although the war in Iran has created challenges for data centers in the region, Humain says it has recovered lost time and remains committed to its expansion.

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