Google to invest $1B in UK data center amid ongoing company layoffs

Google said layoffs will continue in 2024 to help meet the company’s AI goals. The U.K. investment was announced the following day.

Google recently announced it will build a $1-billion data center near London as part of its continuing expansion into the United Kingdom.

The new data center will support the company’s services, including Google Cloud, Search, Maps and YouTube. Google said the new 33-acre site will bring jobs for both on-site employees and construction workers.

According to a blog post from Google, the new data center will be designed to operate carbon-free by the end of the decade:

“We’ve set out our ambitious goal to run all of our data centers and campuses on carbon-free energy (CFE), every hour of every day by 2030.”

Layoffs to continue

As Cointelegraph reported, Google recently laid off hundreds of employees at the start of 2024, with plans to continue layoffs throughout the year.

Google CEO Sundar Pichai said the downsizing was needed so that the company could create the “capacity” to further invest in priority technologies such as AI.

In 2023, Google laid off more than 12,000 workers after committing to reduce its global workforce by 6%. The company expects to lay off fewer employees in 2024, according to Pichai.

Coming from behind

Myriad analysts have noted over the past year that Google appears to have fallen behind its chief artificial intelligence rival, Microsoft.

While Google performed well enough in 2023, Microsoft managed to start off 2024 by overtaking Apple as the world’s most valuable company. This is largely due to the popularity of AI products built in partnership with ChatGPT maker OpenAI.

Google’s expansion amid ongoing layoffs could signal an internal shift. The Mountain View firm has long referred to itself as an “AI-first” company; however, some analysts believe its lagging position is self-inflicted.

Cyrus Mewawalla, head of thematic intelligence at GlobalData, said last year in an interview with CNBC that Google may have been reticent to bring its own generative AI products to market ahead of competitors such as Microsoft due to fear that it could “cannibalize its core business” of Google Search.

Its current ambitious approach to expansion appears to indicate Google plans to move aggressively to make up ground.

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