Global private equity giant Blackstone Group LP and Alphabet have announced the formation of a new AI cloud computing joint venture. The company aims to build large-scale AI computing infrastructure centered around Alphabet's proprietary Tensor Processing Units (TPUs).

According to the agreement, Blackstone will provide an initial $5 billion in equity capital, with plans to establish 500 megawatts of data center capacity by 2027. The new entity will offer data center capacity, networking, and Alphabet's TPUs as a compute-as-a-service product. Sources indicate the total project investment, including leverage, is expected to reach approximately $25 billion.

This collaboration is seen as Alphabet's most significant step yet in promoting its in-house chips and challenging Nvidia's dominant market position. Alphabet's TPU is a chip specifically designed for AI model training and inference, having provided over a decade of computational support for products like Gemini. Blackstone President Jonathan Gray stated that this venture seizes a generational opportunity for the large-scale construction of AI infrastructure.

To lead the joint venture, Blackstone has appointed Benjamin T. Sloss, a seasoned executive with over 20 years at Alphabet, as CEO. This move will combine Blackstone's expertise in energy and digital infrastructure with Alphabet's leading AI technology.

The establishment of the new company directly positions it against emerging cloud providers like CoreWeave, which is backed by Nvidia. As AI firms such as Anthropic have committed to accessing several gigawatts of TPU computing power starting in 2027, Alphabet is rapidly expanding the footprint of its chip ecosystem.