Global tech giants investing billions into South African AI

Several international tech companies have announced artificial intelligence infrastructure investments in South Africa, totalling billions, promising that it has the potential to create hundreds of thousands of jobs in the coming years.

Microsoft and Google are among those pumping money into the country’s nascent AI sector.

The infrastructure in question is data centres, which house the computing power necessary to run AI models.

AI has three primary layers, Microsoft president Brad Smith explained at a March press briefing in Sandton — the infrastructure layer, the model layer, and the application layer.

“You build the infrastructure so that people will build AI models, you use the models to build applications, and when you use the applications, then you can expand further,” Smith said.

At this briefing, attended by President Cyril Ramaphosa, Smith announced that the tech giant would invest R5.4 billion in expanding its data centre footprint in South Africa.

This will build on its existing R20.4 billion infrastructure investment.

Microsoft said part of the R5.4 billion would also be allocated to paying for 50,000 people to gain access to AI courses and earn Microsoft certification in various fields.

This training will include three types of skills: AI fluency, AI engineering, and AI systems design. In addition to these AI skills, the initiative includes cloud architecture and cybersecurity skills.

Smith added that the tech giant’s overarching goal is to provide AI skills to one million South Africans by 2026.

A few weeks later, Google officially launched its Johannesburg cloud region, the search giant’s first in Africa. It should be noted that the infrastructure came online roughly a year prior to the announcement.

While Google did not disclose the value of its investment, data management company Tregter said it was worth R2.5 billion.

Whatever the investment, it will not only add value in terms of additional infrastructure but also contribute to South African data centre providers.

This is according to Google’s director for strategic missions and partnerships, Clayton Naidoo, who gave a nod to South African data centre providers it partnered with to collocate its capacity.

Collocation is when a customer rents space in a data centre to house its servers and hardware. In this case, that customer happens to be a large cloud player like Google.

Google declined to comment about whether they are using Teraco, Africa Data Centres, NTT Data, or another collocation provider for this collocation.

While it declined to disclose the investment’s specifics, it said the cloud region would help create 300,000 jobs and contribute R1.7 trillion to the South African economy.

“I do believe that when you have a large number of organisations willing to invest in training, you could leapfrog many other countries and become an AI leader,” Google Cloud’s Europe, Middle East, and Africa President Tara Brady said.

He added that Google has identified a unique advantage in South Africa due to its high unemployment rate, which is not seen in other countries around the world.

“When you have such high unemployment, it means that we can put those people to work, which is an opportunity that we don’t have in other regions,” he said.

Cassava Technologies, owner of Africa Data Centres, is the latest company to announce an AI investment in its South African data centre infrastructure.

In late March, the London-based company announced plans to build Africa’s first AI factory by upgrading its data centres with Nvidia AI computing technology.

Cassava said the Nvidia-powered computing and AI software that employs Nvidia Cloud Partner architectures will be deployed at Africa Data Centre facilities in South Africa, followed by data centres in Egypt, Kenya, Morocco, and Nigeria.

The supercomputers powering the data centres will be Nvidia GPU-based, allowing for faster AI model training and fine-tuning, Cassava said.

Using its ultra-low latency fibre optic network, Cassava plans to deliver AI-as-a-Service across the continent using the computing power in its AI-enabled data centres.

“Building digital infrastructure for the AI economy is a priority if Africa is to take full advantage of the fourth industrial revolution,” said Cassava Technologies founder and chairperson Strive Masiyiwa.

“Our AI Factory provides the infrastructure for this innovation to scale, empowering African businesses, startups and researchers with access to cutting-edge AI infrastructure to turn their bold ideas into real-world breakthroughs — and now, they don’t have to look beyond Africa to get it.”