Now his Wechat feed and industry groups talk a different story. Dealers are discredited in their shops and the prices have come back to earth. In the meantime, two data center projects with which Li is familiar with the further financing of investors who expect poor returns have to secure, and the project means that projects are forced to sell excess GPUs. “It seems that everyone sells, but only a few buy,” he says.
A few months ago, a boom in the data center building was up to date, which was heated by the government and private investors. However, many newly built facilities are now empty. According to the people on site, with whom speech With Technology Review– Including contractors, a manager at a GPU server company and project manager – most companies that lead these data centers have difficulties to stay over water. The local Chinese branches Jiazi Guangnian And 36 KR report that up to 80% of the newly created arithmetic resources of China are not used.
The renting of GPUs to companies that you need to train AI models -The main business model for the new wave of data centers -was once considered safe. But with the rise of Deepseek and a sudden change in the economy around the AI, the industry has stalled.
“The growing pain of China's AI industry is largely on inexperienced actors – companies and local governments – the result of the Hype train and the construction of institutions that are not optimal for today's needs,” says Jimmy Goodrich, Senior Advisor of Technology at the Rand Corporation.
The result is that projects fail, energy is wasted and data centers have become “desperate assets” whose investors want to unload them below the market price. Finally, the situation could arrange the government's intervention, he says: “The Chinese government will likely occur, the takeover and handover to more capable operators.”
A chaotic building boom
When Chatgpt exploded the scene at the end of 2022, the reaction in China was quick. The central government described the AI infrastructure as a national priority and asked the local governments to develop the development of so-called intelligent computer centers into accelerated-a term that was shaped to describe AI-focused data centers.
In 2023 and 2024, according to KZ Consulting, a market research company KZ Consulting, everywhere from the inner Mongolia to Guangdong were announced everywhere. According to the data center committee of the China Communications Industry Association, a state -related industrial association, at least 150 of the newly built data centers were completed by the end of 2024. The local governments strongly promoted them in the hope that they would stimulate the economy and establish their region as an important AI hub.