AsianFin -- Alibaba Group Chairman Joe Tsai has cautioned against a potential bubble in data center construction, suggesting that the rapid expansion may surpass initial demand for AI services.
Speaking at the HSBC Global Investment Summit in Hong Kong on Tuesday, Tsai noted that the surge in server infrastructure—driven by big tech firms, investment funds, and other entities from the U.S. to Asia—appears increasingly indiscriminate. Many projects, he warned, are being built without clear customers in mind.
From Microsoft to SoftBank, tech giants on both sides of the Pacific are pouring billions into acquiring Nvidia and SK Hynix chips essential for AI development. Alibaba, which committed in February to an AI-first strategy, plans to invest over 380 billion yuan ($52 billion) in the next three years. Meanwhile, data centers are rising across India, Malaysia, and the U.S., where Trump has promoted a massive Stargate project with a projected cost of $500 billion.
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