If you're wondering why the Nasdaq is suddenly tumbling this morning, wonder no more...
Nasdaq moves lower after Meta announces it is to build a cloud business to sell its excess AI compute, weighing on cloud peers like AMZN, ORCL, MSFT and chip and memory names like NVDA, MU, INTO. As Bloomberg reports:
Meta, which has been rushing to secure expensive data centers and other infrastructure to fuel its own artificial intelligence ambitions, is forming a business to generate revenue from excess computing power sold to outside customers, according to people familiar with the matter, who asked not to be named as the details aren’t public.
One potential plan includes selling access to various AI models that are hosted on Meta’s existing AI infrastructure, an approach similar to AWS’s Bedrock offering, the people said.
Meta would run the data centers and chips that power the models, including its own Muse Spark models, and charge developers to access them.
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Despite the complexities, Meta Chief Executive Officer Mark Zuckerberg has signaled to investors that he’s open to selling excess computing infrastructure, or even a so-called API service where customers would pay for AI usage — a business that’s usually measured in “tokens,” or the amount of data used and generated for a customer query.
“It’s definitely on the table,” Zuckerberg said during a call with shareholders in May.
“Almost every week there are different companies that come to us from the outside asking us to both stand up an API service or asking if we have compute that th
