Capacity Shortage: Three AI Giants Were in the Running to Lease a Single Data Center

Google and Microsoft were in talks to lease capacity at Nscale’s large data center currently under construction in West Virginia, but the contract ultimately went to Anthropic, according to a source cited by the insider publication Semafor. The AI startup will pay $45 billion to use the first of three buildings in the 460-megawatt Nscale complex, Bloomberg reported yesterday, citing sources familiar with the agreement.

The interest in the Nscale Monarch data center highlights just how intense the competition for computing power has become: amid the large-scale construction of AI infrastructure, companies are striving to secure the necessary resources in advance, writes Semafor. According to Semafor, Microsoft withdrew from negotiations this summer as it reviewed its data center portfolio and the share of electricity it generates on its own. According to Bloomberg, Microsoft had reserved the Nscale data center in March but abandoned the site in early summer.

The deal with Google fell through for reasons related to the tech giant's internal reassessment of its computing needs and its approach to managing capital expenditures, according to Semafor.

Anthropic declined to comment to Bloomberg; Microsoft declined to comment to Semafor and Bloomberg; Google did not respond to Semafor’s request.

For Anthropic, the agreement with Nscale provides access to additional computing capacity ahead of its planned IPO, Semafor notes. In recent months, Anthropic has signed several other major agreements in the field of computing infrastructure, including one with Fluidstack worth $50 billion and another with SpaceX worth $45 billion.

This article was AI-translated and verified by a human editor