Google seals $10 billion cloud deal with Meta amid AI race

WEB DESK: Google has signed a six-year cloud computing deal with Meta Platforms worth more than $10 billion, according to a source familiar with the matter.

The agreement, revealed on Thursday, is the latest sign of how tech giants are racing to secure computing power for artificial intelligence.

Meta’s big AI bet

Under the deal, Meta will rely on Google Cloud for servers, storage, networking and other services. The two companies did not immediately comment, but the arrangement was first reported by the Information.

The timing is significant. Meta’s chief executive Mark Zuckerberg has been clear about the company’s ambitions in artificial intelligence. In July, he said Meta would pour hundreds of billions of dollars into building massive AI data centres. Last month, Meta lifted the lower end of its annual capital spending forecast by $2 billion, now estimating between $66 billion and $72 billion.

At the same time, Meta has been looking for outside partners to share the burden of these costs. Earlier this month, it disclosed in a filing that it would sell $2 billion worth of data centre assets to help fund its AI push.

Google’s growing cloud momentum

For Google, the deal is another major win. In June, Reuters reported that OpenAI was also turning to Google Cloud to meet its growing computing needs, despite the two being rivals in the AI space. The collaboration highlighted how even competitors sometimes need to lean on each other when demand for computing power surges.

The fresh agreement with Meta follows a strong quarter for Google’s parent company Alphabet. In July, its cloud unit reported an almost 32 percent jump in second-quarter revenue, beating Wall Street expectations.

As the AI boom gathers pace, cloud providers have emerged as the backbone of the industry. With Meta’s commitment to AI spending and Google’s growing cloud footprint, this partnership underscores just how valuable computing capacity has become in the race to shape the future of artificial intelligence.