Where AI Lives: The Cloud’s Favorite Cities And What Comes After

Forbes - May 12th, 2025

AI infrastructure is rapidly evolving, moving beyond established hubs like Ashburn, Virginia, and expanding into emerging markets such as Johor, Malaysia, and Lagos, Nigeria. According to Synergy Research Group, 60% of the global colocation market is currently concentrated in just 20 cities. However, these cities are facing challenges such as power constraints and high real estate prices, prompting a shift towards new locations with more room for growth. The decentralization of AI infrastructure is driven by the rising demand for localized computing power and the need for new data center models that offer better efficiency and proximity to users.

This evolution is significant as it indicates a move away from highly centralized hyperscale data centers to a more distributed, tiered model that includes regional hubs and edge nodes. Emerging markets offer favorable conditions such as lower costs and pro-business environments, enabling them to attract significant investment in digital infrastructure. The transition is further supported by advances in AI model efficiency, on-device AI chips, and alternative hardware options challenging the dominance of traditional GPU-based systems. This reshaping of AI's physical geography reflects broader trends in infrastructure strategy, driven by factors such as power availability, policy considerations, and the need for low-latency inference solutions.

Data Centers Ai Infrastructure Ai Efficiency Cloud Computing Decentralization Synergy Research Group Hyperscale Data Centers Emerging Markets

Story submitted by Fairstory

RATING

7.2

Fair Story

Consider it well-founded

The article effectively captures the current trends and future directions of AI infrastructure, supported by credible sources and data. It provides a comprehensive overview of the decentralization of AI and its implications for global markets. However, it could benefit from a more balanced perspective by addressing potential environmental and social impacts. The use of technical language may limit its accessibility to a broader audience, but the topic's timeliness and relevance are strong points. Overall, the story is informative and well-researched, with room for improvement in transparency and readability.

Accuracy

The story provides a largely accurate depiction of the current state of AI infrastructure, supported by credible sources such as Synergy Research Group. The claim that 20 cities account for 60% of the global colocation market is well-supported by data. However, some claims, such as the rapid emergence of new AI hubs, while plausible, would benefit from additional data points or corroborating sources. The mention of specific technological advancements, like the rise of new AI chips, aligns with industry trends, though specific performance claims could use further verification.

Balance

The article primarily focuses on the technological and economic aspects of AI infrastructure, offering a comprehensive view of the industry's evolution. However, it could be more balanced by including perspectives on potential environmental impacts or social implications of AI decentralization. The emphasis on emerging markets is a positive aspect, but the story could delve deeper into the challenges these markets face in becoming AI hubs.

Clarity

The article is generally clear and well-structured, with a logical flow from the current state of AI infrastructure to emerging trends. However, some technical terms and industry jargon may be challenging for general readers. Simplifying language or providing definitions could improve comprehension.

Source quality

The story references credible sources like Synergy Research Group, known for their expertise in data center research. The reliance on industry reports and expert opinions lends credibility to the story. However, it would benefit from a broader range of sources, such as academic studies or interviews with industry insiders, to provide a more rounded perspective.

Transparency

The article provides some context and background for its claims, particularly regarding the concentration of AI infrastructure in certain cities. However, it lacks detailed explanations of the methodology behind the data cited, such as how the 60% market concentration figure was derived. Greater transparency in these areas would enhance the article's credibility.