Google and Blackstone Bet $5 Billion to Break Nvidia's AI Stranglehold

Alphabet-owned Google and financial giant Blackstone will sign one of the tech sector's most ambitious business moves so far this year: both companies will team up to create a new cloud company with artificial intelligence in a move that takes direct aim at the throne that Nvidia has held for years in the AI computing market. The deal was officially confirmed hours after the first details of the deal began circulating.

The exclusive was initially revealed by The Wall Street Journal, which previewed the core terms of the pact: an initial injection of $5 billion in capital provided by Blackstone, which will also become the majority shareholder of the new company, based in the United States and as yet unnamed.

According to the report, the Wall Street firm will have a total of about $25 billion in computing investments, including financial leverage. Executive leadership will fall to Benjamin Treynor Sloss, a veteran Google executive who will take over as CEO of the combined company.

The stated goal is ambitious: to bring 500 megawatts of computational capacity online by 2027, a figure equivalent to the electricity consumption of a medium-sized city, with plans to scale further in subsequent years. The venture will use Google's specialized chips known as TPUs (Tensor Processing Units), along with the company's software and services, thus configuring a concrete alternative to Nvidia's dominant offering in this segment.

For Google, the move marks a change of strategy. TPUs, developed over a decade, had been used mainly internally or through one-off agreements, such as those signed with Anthropic, the creator of Claude, and with Meta, owner of Facebook. The alliance with Blackstone, on the other hand, represents the tech giant's biggest attempt to commercialize and monetize its own processors on a large scale, at the height of a boom in demand for infrastructure to train and run advanced AI models.

Blackstone, meanwhile, reinforces with this deal its position as one of Wall Street's most aggressive players in the artificial intelligence ecosystem. The firm bills itself as the world's largest data center provider, with previous investments in CoreWeave, Anthropic, and OpenAI. The venture with Google is the second bet by BXN1, the unit recently created by Blackstone to centralize its AI investments, following a $1.5 billion deal with Anthropic announced earlier this month. The question now is whether this new alliance will finally succeed in moving the board that Nvidia dominates without argument.