Blackstone Inc (NYSE:BX) and Alphabet’s Google have announced a joint venture aimed at developing a new US-based company that will provide dedicated cloud infrastructure centered on Google’s Tensor Processing Units (TPUs).
The planned company will offer data center capacity, operations, networking, and TPUs as a compute-as-a-service platform, giving customers an alternative way to access Google’s AI-optimized chips outside of Google Cloud.
Under the terms of the agreement, Blackstone will make an initial equity commitment of $5 billion, with capital sourced from funds it manages.
The partners expect the venture to bring its first 500 megawatts of capacity online in 2027, with plans to expand significantly over time as demand for AI infrastructure grows.
Google will supply TPUs, along with supporting software and services, to enable the new company to scale its operations. TPUs are custom-designed chips built for artificial intelligence workloads, including training and inference for large-scale AI models.
Google has deployed the technology for more than a decade across its own products and external customers, including research labs, financial institutions, and high-performance computing users.
The joint venture will be led by Benjamin Treynor Sloss, a longtime Google executive who has spent more than two decades working on the company’s global infrastructure and operations.
Blackstone President and COO Jon Gray said the partnership represents a “generational opportunity” to invest at scale in AI infrastructure.
“We are incredibly proud to partner with Google – bringing together their world class TPUs and AI capabilities with Blackstone’s exceptional strength in energy and digital infrastructure,” Gray said.
Thomas Kurian, CEO of Google Cloud, added: “This joint venture with Blackstone helps meet growing demand for TPUs, which are optimized specifically for efficiency and performance in the AI era.”
Alphabet Inc (NASDAQ:GOOG) shares were down 2% at $385 in the early afternoon on Tuesday, while Blackstone stock was down 1% at $116.
