Alphabet and Blackstone's Cloud Venture Faces Delays in Data-Center Construction
Alphabet Inc. (GOOGL) and Blackstone Inc.'s joint venture, Project Braid, is encountering delays at key data-center locations intended to run Google’s AI chips by 2027. The project, backed with $5 billion from Blackstone, aims to rent out Google's processors but has faced setbacks due to supply chain issues, regulatory scrutiny in Texas, and challenges securing suitable infrastructure like transformers for new sites. One major issue arose when Alphabet abandoned a plan involving data-center developer Crusoe after losing confidence in its execution. The project is now being re-permitted with reduced scope. Additionally, equipment shortages—such as switchgear—and labor bottlenecks are slowing progress across the industry. Project Braid executives remain optimistic but acknowledge that only about half of planned projects will meet their deadlines. The venture highlights broader challenges for neoclouds and Big Tech in scaling AI infrastructure amid rising regulatory scrutiny and physical constraints, which could impact Blackstone’s ambitions to lead digital infrastructure financing.
Topics: AI ambitions cloud computing data centers venture delays