Big Tech’s AI Push Sparks New Risk Management Deals

The A. I. boom is rewriting the rules of risk management in the tech industry. As companies like Microsoft, Meta, and Google pursue their artificial intelligence ambitions, they are offloading the financial risks associated with building and maintaining massive data centers onto smaller, often lesser-known players. This strategic maneuvering has resulted in a series of deals that have allowed these tech giants to lease computer power, secure financing, and commit to renting computing power without taking on the debt themselves.

For instance, Microsoft recently announced a series of deals totaling tens of billions to lease computer power for its A. I. endeavors. Similarly, Meta secured almost $30 billion in financing to build a massive data center in Louisiana, while Google committed to rent computing power from a small company and then sell some of it to OpenAI. These deals have one thing in common: they enable companies with massive quarterly profits to reduce their financial exposure to the frenetic, global buildup of data centers.

By pushing some of the risk onto upstarts eager for a piece of the action, tech giants like Meta and Microsoft can add computing power quickly and then wait to see how demand for A. I. shapes up before committing to projects that can last for decades.