Microsoft's Datacenter Deficit Goes Critical

Dear Reader,

Microsoft (MSFT) is planning to invest $80B into data centers this year, because it can’t keep up with demand from its cloud-computing business, and to support its growing AI endeavors. 

That’s the takeaway from a recent announcement the company made concerning slower than expected growth in its Azure cloud-computing platform. 

And this is a problem not isolated to Microsoft. 

The demand spike brought on by AI is an issue plaguing the entire sector and will have ripple effects through the entire economy in the coming years. 

All told, Apple (AAPL), Alphabet (GOOG), Meta (META), Amazon (AMZN) and Microsoft have earmarked close to half a trillion in new data center projects to support growth in artificial intelligence and cloud computing capacity. 

Datacenter Investment May Soon Exceed US Defense Department Spending

But even that may not be enough, as global data transfer rates continue to skyrocket, with as much as 10x growth in volume expected by the end of the decade.

For a global network that’s struggling to handle today’s bandwidth requirements, that sort of explosion in demand spells potential doom. 

There simply may not be enough suitable real estate or power available for that sort of growth, unless of course an innovation comes along which changes everything. 

Innovations like the kind required to cure this looming crisis do come along every once in a while, and when they do, everything changes. 

It happened in the late 1940s with the advent of the transistor. 

Then again in the 1950s with the emergence of the integrated circuit, and in the 1970s with the arrival of the microprocessor. 

Changing Civilization With The Photon

Each event led to the next, leading us to today’s computerized, networked, wireless global society. 

The next step, which will allow the leap in data center bandwidth that society needs for AI and cloud computing to continue to grow, will be viewed no differently by history. 

Today,  that next step is already here. 

A component known as the optical interposer will go down in history as the next in the line of game-changing inventions propelling the information-age.

These devices use photons, not electrons, to carry information between data center terminals. 

Using less energy and producing no electrical resistance, optical interposers have the potential to increase data flow by a factor of 8,  and without requiring any extra investment in energy. 

For major tech companies whose next generation of data centers may be some of the biggest buildings in the world, a component with that sort of functionality can spell the difference between evolution and death. 

The Dreadnaught Of The Information Age

Because once it hits the market in full force, this technology will become necessary just to stay competitive. 

The company that’s about to flood the tech sphere with these devices is based in Toronto and valued at just a few hundred million dollars — fractions of the $15-$20 trillion in market capitalization that will rely on its device. 

But things are about to get very interesting. 

This company just signed an agreement to provide high-speed optical engines to execute high-speed trading for a global capital markets firm.

While not the biggest contract, it’s extremely telling because besides government, this is the most sensitive kind of client there is, with billions in assets riding on every transaction. 

That means the technology works and works reliably. 

With big tech watching closely, the only people to have overlooked this story seems to be the retail investors. 

But their mistake could become your biggest windfall ever. Because right now, this component developer is valued at maybe 1% of its long term potential. 

Get all the facts, right here.