Missing money, shipped chips and a 350,000% profit: key takeaways on AI phantom investments'

"The government said that these numbers came from the companies themselves, and that it had no mechanism in place to audit them. It could not say what these investments involved: equipment, capital or something else. Asked about a contract it said had been signed to build the supercomputer in Loughton, the government did not answer."

"Nscale and CoreWeave have both indicated that a large part of their massive investments will take the form of Nvidia chips, which they will buy and place inside datacentres in the UK. From there, these chips will be rented out to users in the UK, including US tech companies."

"This does not mean $2.5bn will be injected into the British economy. As another example, in 2024, CoreWeave and the government announced a 1bn investment that, as it was described, would bring two new datacentres to the UK. CoreWeave said this would create jobs. New datacentres were not built."

The Guardian investigated claimed AI supercomputer investments in the UK, revealing significant discrepancies between government announcements and reality. A purported Essex supercomputer site remains a scaffolding yard despite claims of completion by year-end, with land records showing Nscale does not own the property despite stating otherwise over a year ago. The government acknowledged it cannot audit billions in investment claims from companies like Nscale and CoreWeave, lacks clarity on what investments entail, and has no formal contracts—only capital commitment intentions. These investments largely consist of purchasing Nvidia chips manufactured in Taiwan by US companies, which are then placed in UK datacentres and rented to international tech firms. This structure means claimed investments do not translate to genuine economic injection into the British economy.

Read at www.theguardian.com