PTC, as soon as a small and sunny telecoms occasion, is now a fully-fledged AI infrastructure present. The 2026 model, in Honolulu, opened with acquainted fanfare in regards to the scale of the worldwide AI build-out. However between the large numbers and flashy pyrotechnics, there was a bracing actuality examine – in regards to the digital divide between the tech sector and each different industrial market, and within the tech sector itself as crucial telcos wrestle for a share of the pie.
In sum – what to know:
Digital divide – international financial system is seeing a “k-shaped” divergence between AI firms and everybody else.
Crucial telecoms – fibre infrastructure underpins the AI increase, however faces its personal historic progress challenges.
Choke factors – jeopardy comes with energy provides, chip wars, capital constraints, collapsing asset lifecycles.
All the cash, all the facility, all of the promise. The tech {industry} has by no means been so all-powerful – in case we want reminding. “It’s the finish of the world as we all know it,” stated Invoice Barney, founder and chief government at Asian Century Fairness at PTC’26 in Hawaii, yesterday (January 19). He stated it repeatedly. It was a full of life opening to the Honolulu showcase, as Barney, a fixture on the scene, talked a mile-a-minute in regards to the state of the AI infrastructure market.
“None of us have seen this earlier than,” he stated, additionally repeatedly. PTC’26, as soon as a sunny new-year jaunt for the US telecoms {industry}, is now about AI infrastructure. The opening keynote and subsequent ‘centre-stage’ periods largely mentioned the data-centre build-out for hyperscalers to coach frontier fashions; there was stuff about terrestrial and subsea fibre, however there was extra about energy infrastructure, for instance – because the deal breaker for large AI builds.
Barney detailed the financial set-up: that the large eight US tech shares, up 50 % within the yr, are propping up the worldwide financial system, to the purpose US progress can be flat, or marginally down, in any other case; that the entire of geopolitics, virtually, hinges on their fortunes, notably in opposition to their current and future equivalents in China. To his credit score, Barney was not mincing phrases: the “canaries and digital coal mines”, the “issues that maintain you up at evening”.
Which is the bit about telecoms, and the everlasting wrestle to monetize it. “The capital we’re spending doesn’t match what we have to get performed… Subscribers aren’t paying what must be paid to construct these networks,” he stated. Extra broadly, and terribly, there’s this “k-shaped financial system”, he stated, the place the tech {industry} is raking it in, hand-over-fist, whereas all the pieces else goes south. “The remainder of the industries are type of going like this,” he stated, pointing down.
It’s the elephant within the room – apart from the geopolitics, which cleaves to this industry-splitting digital divide, and the well being of the planet, tied to dialogue about the way to gas the AI increase. “Tech firms are accelerating, whereas the remainder of the inventory market… is declining. Bricks-and-mortar firms should not doing that effectively. And it’s not simply the US; it’s all over the world. Which is inflicting a number of the challenges, not solely with the financial system, but additionally with politics.”
Barney went on: “There’s two teams: the folks which might be making a living and the people who aren’t… Sadly, whether or not we prefer it or not, we’re on the centre of a number of the issues which might be occurring throughout the US and all over the world – as attributable to the financial state of affairs… The general public on this room are joyful as a result of their shares are going up. However lots of people all over the world aren’t so joyful about the place issues are going.”
Digital divide
It was a second for pause, possibly, for an {industry} watching fireworks on a paradise island within the Pacific Ocean, which certainly can not consider its luck – and which is, personally and collectively, in thrall to this new financial engine. So Barney’s level that this digital divide between industries extends instantly into the tech {industry} as effectively, to
He mirrored: “Twenty years in the past [at this event], we solely talked about networks – voice networks, then information networks. That is the Pacific Telecom Convention, proper? It was all the time about telecom. However the telcos have change into a really small piece of the ecosystem. They’ve change into a utility that transports [the data]… [And yet they] additionally need to be stronger, quicker, and extra highly effective, [even as] telecoms will get much less and fewer and fewer of the pie.
“[It’s a] very troublesome spot. Fibre operators and cell operators are seeing a capital crunch. Although the tech {industry} is doing very effectively, [even as] information facilities [are] accelerating, it’s a arduous slog for them. It’s a battle simply to maintain working, and even to develop slightly – even because the {industry} is exploding. They’re getting the least quantity. However they play in all probability essentially the most crucial position. When you don’t have the networks, you possibly can’t transport the purposes.”
This can be a retelling, in fact; Barney additionally detailed the superior scale and unknowable potential of this international AI constructing venture. For its half, PTC is breaking data, he stated: the largest present ever, in 50 years historical past; standing room solely within the submarine periods on Sunday; 6,000 folks for the Nokia-sponsored reception on Monday evening, he stated – the primary time the occasion had hosted fireworks since 2001 (“and everyone knows what occurred after that”).
In any other case, the {industry} is constructing gigawatt AI information centres in 19 months – the place it used to take 5 years to construct a cloud information centre with a fraction of the processing necessities. “We’re in a brand new place, and it’s an incredible place with a number of constructive components, in addition to destructive issues. Our {industry} is the main and quickest rising a part of the financial system, and we’re altering folks’s lives. We are going to change human lives.” You get the thought.
Extra fascinating, all the time, is the mechanics of it, to see the way to end the venture, and see the place it really goes – and to evaluate the jeopardy alongside the best way. And Barney’s handle pointed to all of the pitstops. “To not scare folks, however there are some issues we’ve obtained to maintain behind our minds as we go ahead,” he stated. The largest problem, possibly, is energy. “We’ve obtained a state of affairs the place we want electrical energy very, very quick.”
He stated: “Within the US, there’s a 20-30 % hole between the facility that’s going to indicate up and the facility that’s wanted. So an enormous downside is the way to speed up that facet of the {industry}.” Fuel? Steam? Nuclear? All the pieces’s on the desk, and nothing is simple. Microsoft’s new Fairwater information centre complicated in Wisconsin makes use of extra energy than the town of LA – monster city energy centre, by any stretch.
There shall be seven such campuses within the US by the tip of 2026, and 19 by the tip of 2027. “That is the start of the long run,” he stated. Anthropic has simply constructed a knowledge centre (someplace) in “lower than two years”, he stated. “Which is extraordinary… It requires a gigawatt of energy, and the facility {industry} can’t get to a gigawatt of energy in two years. As an {industry}, we’re turning into extremely environment friendly; the problem is whether or not the infrastructure can maintain tempo.”
The state of affairs has pressured Google’s hand. Late December, its mum or dad, Alphabet, spent $4.75 billion to purchase renewable power developer Intersect Energy within the US to bypass grid points. “It’s the first time a hyperscaler has purchased an influence firm, and, I feel, the primary in a collection of [such deals] over time.” As an apart, it’s an instance, as effectively, of how over-the-top software program giants from the web age have gotten capital-intensive infrastructure firms.
Tech order
Similar to telcos. And Barney posed a query, right here, about whether or not this AI build-out will create a brand new tech order – or fairly, implicitly, whether or not the identical web giants shall be high when it does. He pointed to a altering of the guard amongst bricks-and-mortar data-centre firms, a minimum of. “When you have a look at the highest of the chart,” he stated, pointing to a different (nice) slide (see above), “that’s Digital Realty, which has been the chief for the previous few many years.
“Going ahead, new information centre operators shall be greater than Digital Realty, they usually’ll do it with simply two campuses or two buildings. The truth is we might be able in some unspecified time in the future the place this whole chart, these firms, these darlings of the web on the inventory market, may not even be within the high one, two, three; they might drop 4 or 5 slots. And that would occur within the subsequent two or three years.”
Which supposes, maybe, that the subsequent 5 years of infrastructure constructing will proceed to be about centralised AI coaching centres, as a lot as about distributed hybrid infrastructure for inference and personal edge management. Both approach, the message was that change is occurring quick, and all the pieces is up for grabs. It was a packed presentation; Barney skipped in regards to the neocloud suppliers (“I name them nouveau tech, as a result of they don’t wish to be known as neoclouds”), the submarine {industry}, the chips sector, and the entire China story, as effectively.
He commented: “Digital infrastructure is altering. How we function the info middle may be very totally different from even simply two years in the past. Which has an impression by way of funding. When you have a look at the ecosystem, you begin to notice there are some very massive chinks within the armour as we begin to take a look at the digital ecosystem because it goes ahead.” RCR Tech will get into the bones of it because it unpacks different periods and interviews at PTC’26 over the subsequent weeks.
However to go away it right here, for some additional pause, Barney addressed one other choke level for the market: the shelf lifetime of GPUs. He stated: “An information centre was once a cloud information centre; now it’s an AI information centre. [Which means] the bricks and mortar piece is quite a bit much less by way of the entire ecosystem [and] GPUs are a a lot bigger part… The issue is the lifetime of a GPU is a yr, two years, three years. Usually, you’d have 5 yr cycles with these chips.
“Now you’re getting cycles of lower than a yr in some circumstances – after which they change into out of date. So simply from a financing perspective, you’ve obtained progress in low life belongings, which don’t stay very lengthy, and a decline in long run belongings, within the precise infrastructure to construct the info centres. Which creates a brand new state of affairs the place it’s going to be harder to finance information facilities utilizing debt. It can occur over time, however this can be a actuality.”
