In response to the exponential growth of generative artificial intelligence, Taiwan’s leading data center operator, Chief Telecom, is advocating for a complete overhaul of data center infrastructure.
Why It Matters: Jacky Liu, President of Chief Telecom, believes that the current data center infrastructure is inadequate to support the demands of AI servers. He asserts that a complete redesign of data centers and their supporting infrastructure is necessary to accommodate the AI boom, reported Nikkei Asia on Wednesday.
“The new type of buildings to accommodate data center servers that are able to do AI computing requires massive upgrades and a total redesign of standards,” Liu said.
“The overall cost of this new form of buildings will be at least 50% higher than typical data centers.”
Liu emphasized that the upgrades required encompass all aspects of data centers, from power grid capacity to the load-bearing capabilities of floors.
“Simply remodeling the old buildings is not enough. It requires an entirely new infrastructure,” Liu said.
One of the major challenges is the increased power demands. Traditional power grid capacities of 4 to 6 kilowatts are no longer sufficient, with AI computing data centers requiring at least 10 kilowatts and some designs even demanding 20 kilowatts.
AI servers have also become heavier, with a single AI server rack weighing up to 1,500 kilograms. This weight is expected to increase to 2,000 kilograms, driven by the need for more storage and heat-dissipating components.
Chief Telecom’s newest data center in Taipei, designed to meet the requirements of AI servers, is a testament to the company’s commitment to staying ahead of the curve.
As the demand for AI continues to surge, Chief Telecom is expanding its reach across the region and beyond. The company is partnering with various providers in Southeast Asia to cater to the increasing demand from Taiwanese suppliers moving into the region.
Top U.S. tech companies renowned for their advancements in AI have been pivotal in driving stock market growth. These companies include the “Magnificent Seven” — Microsoft Corp. MSFT, Apple Inc. AAPL, NVIDIA Corp. NVDA, Meta Platforms Inc. META, Tesla Inc. TSLA, Amazon.com Inc. AMZN, and Google’s parent company Alphabet Inc. GOOG, GOOGL.
Among these, Nvidia has seen the most significant surge, rising 162.32% year-to-date.
What’s Next: The need for upgraded data centers is driven by the rapid advancements in artificial intelligence, which has significantly increased the demand for power and infrastructure. This trend is not isolated to Taiwan; globally, tech giants are making substantial investments to keep up with AI demands.
For instance, Vietnam has recently opened its data center market to foreign investors, allowing 100% ownership. This move is expected to attract major players like Amazon, Microsoft, and Google, which are investing billions in data center infrastructure.
Additionally, the energy requirements for these centers are pushing companies to explore alternative power sources. Tech giants like Amazon are considering nuclear power to meet the growing energy needs, raising concerns about grid stability and environmental impacts.
Moreover, geopolitical tensions also play a role. Recently, comments by former President Donald Trump about Taiwan’s defense costs led to a drop in shares of Taiwan Semiconductor TSM, highlighting the sensitive nature of Taiwan’s tech industry and its global implications.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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