Crypto Mining Energy Use Revealed, Chip Industry Back On Track | Data center knowledge

With data center news moving faster than ever, we want to make it easy for industry professionals to cut through the noise and find the most important stories of the week.

The Data Center Knowledge News Roundup brings you the latest news and developments across the data center industry – from investments and mergers to security threats and industry trends.

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Mining for data

In a week in which Texas Governor Greg Abbott declared that the state would need to increase its power supply capacity by as much as 15% annually to keep up with rising demand, new research has been released that shows the rising power consumption of crypto- currency mining operations in sharp focus.

According to the US Energy Information Administration, the annual electricity use of cryptocurrency mining may now represent more than 2% of total US electricity consumption.

“The increased demand associated with cryptocurrency mining may present challenges to the operation of electricity networks,” the EIA said.

Amidst the rapid growth of cryptocurrency mining activities in the US, the agency said it will conduct a mandatory survey focused on evaluating the electricity consumption associated with cryptocurrency mining activities across the country.

In related news, Chinese bitcoin miners have found a new crypto haven in Ethiopia.

The East African nation may seem like an unlikely place to set up crypto mining operations, but cheap electricity and favorable regulations are attracting investors looking to maximize their returns in the sector.

Back in the US, the increased demand for power has led to grid reliability becoming a growing concern for utilities. To bolster its supply during peak times, US power company Duke Energy said this week it was in talks with technology companies, including Microsoft Corporation, about tapping generators installed at their data centres.

The potential plan would have Duke call its data center customers when more electricity is needed and pay them to turn on large generators that serve as backup power supplies.

Chip Watch

The global chip industry is poised for a significant recovery this year with sales expected to rise to a record level, fueled by increased need for electrical components from a wide range of businesses, according to a forecast from the Semiconductor Industry Association (SIA ).

Global sales fell 8.2% to $526.8 billion in 2023, although the drop was softened by improved conditions in the second half of the year, the association said this week. The increasing momentum suggests that sales will rise 13% this year to nearly $600 billion.

The news came as Reuters published an exclusive report detailing how Facebook owner Meta Platforms plans to deploy a new version of a custom chip in its data centers aimed at supporting its AI push.

“The chip, a second generation of an in-house silicon line that Meta announced last year, could help reduce Meta’s reliance on the market-dominating Nvidia chips and the spiraling costs associated with running AI workloads control as it races to launch AI products,” Reuters said.

So it was fitting that Christopher Tozzi, author of Data Center Knowledge, took a closer look at whether custom silicon could give the public cloud an edge over private data centers.

“Custom silicon is quickly becoming one of the key differentiators between public clouds and private data centers,” Tozzi said. “As more public cloud vendors continue to expand their custom chip selections, private data center operators may be at a disadvantage.”

Read the full article to find out more.

AI Regulation Guide

AI continues to make headlines around the world, and according to Forrester, one in three global organizations identify risk and governance as barriers to generative AI adoption. These concerns are set to increase even more now that the EU AI law is becoming a reality.

In an effort to allay these concerns, Forrester analyst Enza Iannopollo wrote a blog post outlining what business leaders need to know before implementing the Act.

“The ability to categorize AI systems and the use cases they support in accordance with the risk-based approach of the Act is a fundamental action,” Iannopollo said. “This means that organizations must start designing their own processes to build, execute and optimize their own approach to classifying AI systems and assess the risks of the use cases at play.”

Ascend

In development news, Blackstone is reportedly in talks to buy Winthrop Technologies, a data center construction major. According to Sky News, Blackstone is the front-runner to acquire the Irish construction firm at a price “believed to be in the region of £700 million ($884 million).

Elsewhere, Datacenter One, the Germany-based provider of colocation services acquired by AtlasEdge in February 2023, has announced the opening of a new data center in Hamburg.

“With the opening of HAM1, Datacenter One continues its rapid success story of developing regional data centers to serve customers throughout Germany, one of Europe’s fastest growing markets for localized digital infrastructure,” the company said.

In Southeast Asia, Bitera – a subsidiary of the MMS Group Indonesia – announced the operational readiness of its data center in Jakarta.

The nine-storey facility boasts a critical IT load of 20MW covering over 8,600 square meters of assembly space, accommodating up to 4,000 racks.

The news came as reports surfaced that Telkom Indonesia plans to sell shares in its data center business to fund the unit’s domestic and global expansion.

In India, meanwhile, Ishan Technologies has launched a new data center in Mumbai. The Mumbai Ishan DC-1 facility will offer “flexible assembly configurations including single rack, split racks, cage, or any modular solution.”

Finally, Moveworks, a US-based AI co-pilot company, has announced the opening of its first regional data center in Australia. This adds to the company’s recent data center expansion in Canada and the EU in 2023.

Other great reads on DCK this week

Data Center Sustainability Forecasts, Hopes and Questions for 2024. Industry experts outline the key challenges and opportunities for data center sustainability in 2024.

AI is pushing new communication technologies into the data center. Huge investment in AI operations within data centers is driving demand for new communications technologies that sit in those facilities.

Microsoft, Amazon-backed cloud body in talks over EU dispute. CISPE said it wants to make “substantial progress” on the cloud software licensing dispute this quarter.

AI is driving the Ethernet and InfiniBand switch market. AI may force enterprises to rewire parts of their data centers so that they are fully optimized to run such workloads. The question is: are you using Ethernet or InfiniBand?

Nvidia, Cisco to help companies build in-house AI PCs. Tech firms are teaming up to make it easier for organizations to build their own AI computing infrastructure.