Amazon to blow $11B on cluster of Indiana bit barns

Talk about going round the (South) Bend

Amazon Web Services (AWS) is adding $11 billion of datacenter capacity in St Joseph County outside South Bend, Indiana, the cloud giant announced Thursday.

Billed as the largest "largest capital investment in the state's history," the project will see the construction of several datacenters in that part of the US Midwest, and add at least 1,000 new jobs to Amazon's existing workforce of 26,000 in the state, the mega-corp said in a statement.

Alongside funding for the datacenters themselves, Amazon also touted the usual infrastructure and community investments aimed at winning goodwill and/or addressing skills shortages in the region. Amazon says it'll pump $7 million into improving roads around the facilities, $100,000 in grant funding for community projects, and offer workshops covering in-demand skills like fiber-optic splicing and datacenter management, as part of the build out.

Amazon hasn't disclosed how many datacenters it intends to build. However it's not usual for hyperscale datacenters — like the one being built by Google in Kansas City, Missouri — cost in the neighborhood of $1 billion to construct and furnish. This suggests that AWS' campus could extend to as many as 11 datacenter facilities.

Many of these facilities will no doubt end up equipped with an assortment of AI accelerators as Amazon looks to bolster its competitive standing in the arena, where Google and Microsoft/OpenAI have taken an apparent lead.

In his annual letter to shareholders earlier this month, Amazon CEO Andy Jassy said generative AI may be the biggest technological advancement since the cloud, if not the internet itself.

In the letter, Jassy laid out his three-layer strategy to capitalize on generative AI demand which, at a high level, is to arm customers with the computing grunt necessary to build new models, commercialize the tools necessary to customize and augment off-the-shelf models like Meta's new Llama 3, and to sell AI-augmented services like its Q code assistant.

As part of these efforts Amazon plans to deploy a massive AI liquid-cooled supercomputer, powered by more than 20,000 of Nvidia's newly announced Grace-Blackwell Superchips, dubbed Ceiba.

But, while Amazon pushes ahead with its AI and cloud investments, it appears shareholders are growing uneasy about the cost of progress and raising questions regarding their return on investment.

Amazon is due to present its first quarter earnings results on Tuesday, however, some, including Meta, have already stoked investor fears of an AI bubble. And with Microsoft, Google, and Intel set to detail their latest quarters this evening, we expect AI ROIs will be a chief concern among analysts. ®

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