Rising "Neocloud" Demand from Financials

Jane Street has signed a $13bn , five year AI cloud contract with "neocloud" provider Crusoe, a former crypto-mining company (2018-2024) which pivoted into AI data-center infrastructure. Crusoe supplies AI compute to Meta, Oracle and now Jane Street. Financially, they recently raised $3bn at a $30bn valuation. Jane Street also has cloud agreements with CoreWeave in which it also has a $1bn equity stake.

Mistral's $830m Debt Raise for Europe Data Centres

Mistral ("Frontier AI. In your hands"), a French AI startup led by ex-DeepMind Arthur Mensch, which has a "Donkey Kong room" in its Paris office, and not to be confused with Mistral Group (UK bus and coach provider), has raised money from a consortium of banks to run a new data center powered by Nvidia chips. A non-exhaustive list of banks involved include HSBC Holdings, Mitsubishi UFJ Financial Group, BNP Paribas ("The bank for a changing world") and Credit Agricole CIB.

Microsoft Q3 Earnings beat Expectations

Investors are keen to see progress on cloud growth, AI and capex trends. Analysts predicted 10% rise in earnings per share from last year to $3.22 with Azure and AI related segments forecast to drive growth. Actual numbers came out at $3.46 per share exceeding analyst expectations. Cloud and AI drove the growth, as Microsoft reported $70.1bn in revenue for the quarter ending in March, a rise of 13% from last year's number. Net income came in at $25.8bn (a rise of 18%). Azure revenues rose 33% from last year.

Musk raises $6bn for xAI

 xAI has raised $6n from investors including Andreesen Horowitz to bring its “first products to market, build advanced infrastructure, and accelerate the research and development of future technologies.” Some of this money will go into data centers with some expensive GPUs. Founder Elon Musk is also suing its competitor OpenAI for its partnership with Microsoft citing an abandonment of its mission to benefit humanity.

UK's Most Westerly Port (Foyle Port) Entices Data Center Investment

Foyle Port, the adopted name for Londonderry Port in Northern Ireland, which has a deepwater facility and is the UK's most westerly port, has granted planning permission for a new data center to create hundreds of jobs. This will be constructed by Atlantic Hub (Director: Brian Doherty), funded largely by Di-squared (Digital Infrastructure Investment) who invest in data centers, recovery sites and mobile network towers across Europe ("data infrastructure as an asset class"). Paul Clancy, head of Londonderry Chamber of Commerce, described the investment as "transformative".

AMD Second Generation Epyc Attacks Intel Xeon

AMD unleashed its new second generation Epyc chip, aimed at Intel Xeon's data center processing market share (for cloud service providers) under the tagline "New Leader. New Rules". AMD are claiming 1.8x-2x performance advantage over Xeon. "Big Data Analytics" is another application area that Epyc is looking to grab. Epyc uses the AMD Infinity Architecture under the hood.

Apple's Big DC Plans - $10bn over 5 Years

Apple is investing big in US DCs.

This includes plans to build a 133 acre campus in Austin, Texas and another build-out in Waukee, Dallas County, Iowa. Tax breaks are helping incentivise investment.

Existing capacity in Maiden, North Carolina; Mesa, Arizona and Sparks, Nevada will be expanded.

Outside of the US, back in July 2017, Apple announced it was building a second DC in Denmark, after their initial one in Viborg (166,000 square metres), with go-live in Q2 2019, shortly after Facebook a similar announcement in January. The DC will be located in Aabenraa in Southern Denmark near the border with Germany and will be powered 100% from renewable energy from day one. The Danish Foreign Ministry was said to have worked with Apple for three years in line with its Invest in Denmark program prior to its investment.

Apple's additional DC capacity will be used to power the iTunes store, Maps, iMessage and Siri.

Better VPNs - LC's StackPath Drives to the Edge

Three-year old startup StackPath founded by Lance Crosby (who sold his previous business, SoftLayer, to IBM in 2013 for $2bn) provides "edge computing infrastructure as a service" - or what he describes as a "secure platform at the edge".

StackPath started its initial play by acquiring rack space in 45 locations (colocation data centers) and is now advancing into cell towers as its founder pivots the company towards 5G. It fills out its real estate with space-efficient custom hardware (packing in as much compute, network, memory and storage as feasible to stick within 10kW per rack). Rack switches are made by the company itself, combining "merchant silicon" (i.e. off the shelf components) with StackPath's network operating system. Arista 7500 series switches are used in some cases, manufactured by Santa-Clara based Arista Networks, led by President and CEO Jayshree Ullal.

Clubbing together with technology experts such as Vapor IO (who combine cell tower and data center technology), Edge Micro (co-founded by Mike Hagan, who previously launched Schneider Electric's colocation and cloud division) and BitBox (owned by Compass Datacenters), Crosby is looking at the next phase of expansion. MEC, or mobile edge computing, is a term which has been used to describe this nascent sub-sector of the TMT world.

StackPath emerged from stealth in 2016 and has made six acquisitions since then, adding Web Application Firewall (WAF), DDoS mitigation and VPN - in other words, software components that can plug into its integrated hardware-software edge platform.

A corporate VPN that is fast, secure and sensitive to the needs of mobile workers is envisioned as a potential use case (allowing workers to connect to the servers at the base of the nearest cell tower).

Another target application is software or data distribution as part of a CDN (content delivery network) - a company can send a software patch in one location and have it delivered via StackPath infrastructure efficiently and securely in each target location. Media, gaming and security are also industries where StackPath is aiming to build client base.

Lance is looking to to accomplish all this at low cost to the customer. For example, 50 VMs could potentially cost $2,500.