LOGO

We’ve previously discussed how the rapid proliferation of artificial intelligence (AI) has significantly increased the global demand for data centers.

In recent years, both semiconductor factories and new data centers have been actively constructed domestically [in Japan]. However, the government aims to achieve net-zero greenhouse gas emissions, including CO2, by 2050.

As companies grapple with the challenge of securing the massive amounts of electricity consumed by data centers, they are devising innovative ways to meet demand while reducing carbon dioxide emissions through the use of renewable energy.

In this context, I’d like to introduce an announcement from Google related to this power challenge.

Google Announces Purchase of Power from Small Modular Reactors

Google has announced plans to purchase electricity from small modular reactors (SMRs) developed and installed by Kairos Power, a US next-generation nuclear power company.

The company aims to have the first SMR operational by 2030 and deploy additional reactors by 2035, with a total of seven SMRs providing 500 megawatts of power.

SMRs can be assembled in factories and then transported to the installation site as a complete unit (module), reducing construction time and costs compared to conventional nuclear power plants. Their smaller size also allows for more flexible site selection and easier cooling, making them safer.

Due to these advantages, SMRs are being developed worldwide, including in the United States, as a next-generation decarbonization power source. However, one of the challenges in implementing SMRs is finding buyers for relatively high-cost electricity until SMRs achieve economies of scale.

For Google, this move aligns with its goal of addressing the power needs of its AI data centers while advancing its decarbonization objectives.

The government is also supporting private initiatives. The US government has set a goal of tripling nuclear capacity by 2050 and is working to promote SMRs through initiatives such as supporting demonstration projects and building a fuel supply chain.

The US Department of Energy (DOE) has announced up to $900 million in support for next-generation SMR development, and public-private efforts to promote SMR development and construction are intensifying.

Power Challenges and the Need for Global Action

In the United States, IT giants are investing in nuclear energy one after another. In contrast, the trend toward phasing out nuclear power is accelerating in Europe, particularly in Germany and Italy. Japan is also not as proactive in nuclear power.

As the demand for AI continues to grow, countries around the world will be forced to address power challenges.

NVIDIA Under Antitrust Scrutiny: Implications for the AI Industry

The U.S. Department of Justice (DOJ) has launched a formal investigation into NVIDIA, the world’s leading semiconductor company, raising concerns about potential antitrust violations. The DOJ has issued subpoenas, signaling a potential antitrust lawsuit against the company.

NVIDIA holds a dominant market share in AI semiconductors, with approximately 80% of the data center market in 2023, according to Omdia. The DOJ’s investigation focuses on whether NVIDIA has engaged in anticompetitive practices that hinder other companies from entering the market.

Beyond hardware, NVIDIA provides software optimized for AI development. The DOJ is examining whether the company has bundled hardware and software, offering preferential treatment to customers who purchase both.

CUDA: The Industry Standard

NVIDIA’s CUDA, a software development environment tailored for its GPUs, has become the industry standard for large-scale computing tasks, including training generative AI models. This dominance is due to NVIDIA’s extensive promotion and the close integration of CUDA with its hardware.

If found guilty of antitrust violations, NVIDIA could face significant penalties and be required to change its business practices. However, the widespread adoption of CUDA presents a challenge, as it would be difficult to quickly replace with alternative solutions.

Implications for the AI Industry

The DOJ’s investigation into NVIDIA highlights the growing scrutiny of Big Tech companies. Recent antitrust cases against Google and Apple set a precedent for increased regulatory oversight.

The outcome of this investigation could have far-reaching implications for the AI industry. If NVIDIA is found to have engaged in anticompetitive practices, it could lead to increased competition in the AI semiconductor market, potentially benefiting AI developers and end users. However, it could also disrupt the current AI ecosystem and lead to uncertainty in the market.

Conclusion

The DOJ’s investigation into NVIDIA marks a significant development in the AI industry. As the investigation unfolds, it will be essential to monitor the potential impact on AI innovation, competition, and the broader technology landscape.