Google and Blackstone are creating a new AI cloud company to tackle soaring demand for high‑powered data centers. The US-based startup will combine Google’s bespoke AI processors with Blackstone’s infrastructure capital to provide “compute as a service” to businesses requiring advanced AI processing. The agreement comes as Big Tech’s annual investment in AI infrastructure, such as data centers and processors, is expected to exceed $100 billion by 2026.
According to Reuters, Blackstone plans an initial equity commitment of $5 billion to the venture. The partners expect that money to bring 500 megawatts of data center capacity online by 2027, with plans to scale further over time. Including debt, total investment in the new platform could reach around 25 billion dollars.
TPUs at the Center of the Strategy
The new company will offer data center capacity bundled with Google’s Tensor Processing Units (TPUs), chips built specifically for AI workloads. Customers will be able to access TPUs through the venture, in addition to their existing access through Google Cloud. Google Cloud CEO Thomas Kurian said the partnership will help meet rising demand for TPUs by giving organizations more ways to reach this type of compute.
Google uses TPUs to train and run large models behind services like its Gemini AI and other generative tools. Analysts say these custom chips, combined with Google’s AI software stack, have helped the company win business from AI firms such as Anthropic and other enterprise customers. The new venture aims to extend that reach into dedicated, high-capacity data centers that Blackstone funds and operates.
Blackstone, the world’s largest alternative asset manager, already has tens of billions of dollars in digital infrastructure investments, including data centers and energy assets. The firm has been ramping up exposure to AI‑related projects as operators race to lock in long‑term power and real estate for compute‑heavy workloads. Blackstone President Jon Gray described AI infrastructure as a “generational” opportunity that requires capital at a huge scale and close ties to power markets.
To lead the new company, Blackstone has tapped Benjamin Treynor Sloss, a veteran Google executive with more than 20 years of experience building and running Google’s global infrastructure. The move underlines how closely the venture will tie into Google’s existing cloud and network operations, even as it operates as a separate, majority Blackstone‑owned entity. In a market where
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