AWS expands data center, boosts Nvidia AI chip access

Amazon Web Services (AWS) is expanding its global data center network and improving access to Nvidia AI chips, according to AWS CEO Matt Garman.

AWS has opened a cluster of data centers in Mexico and is building new facilities in Chile, New Zealand, Saudi Arabia, and Taiwan.

The company’s AI services, including on-demand tools, are expected to generate significant revenue due to growing customer adoption.

Garman confirmed a collaboration with Nvidia to increase the availability of GB200 semiconductors for customers, noting that “demand is strong.”

He also mentioned the possibility of hosting AI models from OpenAI, which is primarily supported by Microsoft.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ AWS’s data center expansion reflects defensive strategy amid market share pressure

Amazon Web Services’ aggressive global expansion comes as it faces intensifying competition in the cloud infrastructure market.

While AWS maintains its leadership with 29% market share, its 17% year-over-year growth lags behind Microsoft Azure’s 21% and Google Cloud’s 28% growth rates 1.

This dynamic explains why AWS is simultaneously expanding into new geographic regions like Mexico, Chile, and Saudi Arabia while also working to secure more Nvidia AI chips, as they’re defending their position against faster-growing rivals 2.

The competitive pressure is particularly evident in AI services, where Microsoft’s partnership with OpenAI has helped drive Azure’s stronger growth rates, prompting AWS to express openness to hosting OpenAI models despite their existing partnership with Anthropic 3.

Since AWS’s founding in 2006, it has maintained market leadership through consistent infrastructure investment, but the current expansion pace reflects a recognition that maintaining this position requires extraordinary capital deployment in an increasingly competitive landscape.

2️⃣ AI-driven power demands reshaping data center economics and design

Amazon’s focus on securing more Nvidia GB200 chips highlights how AI is fundamentally transforming data center requirements and economics.

Goldman Sachs projects AI will drive a 165% increase in global data center power demand by 2030, with AI workloads projected to constitute 27% of total data center power consumption 4.