By Tom Dotan
Microsoft said it is investing billions of dollars on artificial intelligence in Wisconsin, the latest stop in a global spending spree to build AI infrastructure and calm fears about the powerful technology.
President Biden is scheduled to be in Mount Pleasant, Wis., on Wednesday along with Microsoft President Brad Smith to announce the $3.3 billion investment in a new data center there and training programs to educate locals about AI jobs in manufacturing.
The announcement is the latest in a series of large investments the company has unveiled in the U.S., Europe and Asia to expand the reach of its AI network.
Microsoft said the new site would initially create 2,300 construction jobs and eventually as many as 2,000 data center jobs.
Microsoft said it is also investing in a new AI lab at the University of Wisconsin Milwaukee campus to train workers to use AI technology.
As tech titans tout the benefits of generative AI and invest unprecedented amounts in the technology, they are facing public fears that AI will eventually destroy jobs.
Since the launch of OpenAI’s ChatGPT in 2022, demand for AI software and the infrastructure that powers it has exploded. However, data centers — many powered by expensive chips made by Nvidia — have struggled to keep up with demand.
Microsoft, Amazon.com, Google parent Alphabet and Meta Platforms have each committed to spending tens of billions of dollars in the coming year to build out AI infrastructure. The amount of data center space in the U.S. grew 26% last year, according to real-estate firm CBRE, and a record amount was under construction.
Smith said programs such as the manufacturing lab in Wisconsin help show workers AI is designed to assist, not replace, people.
“We have a huge responsibility to help ensure this technology serves people,” Smith said in an interview. “Part of that is ensuring that it works safely and remains under human control. But another part of it is really supporting and aiding the transition of the economy.”
In recent months, the company has announced commitments to invest around $3.4 billion toward AI and infrastructure projects in Germany, $2.9 billion in Japan and $2.2 billion in Malaysia. It also announced it would invest $1.5 billion into U.A.E.-based AI company G42.
Smith said those deals were intended to build out infrastructure in those countries and prepare the local economy for the broader AI transformation. In Germany, for example, he said the company was targeting key industries such as auto and medical equipment makers.
The company is facing increasing scrutiny from regulators over its business practices around software bundling and AI investments. Smith said it wasn’t clear whether these investments would have any effect on regulators, but that the company was focused on communicating to governments the benefits of their technology.
He said the company chose Wisconsin partly because it had the land needed for a new data center, the energy needed to power it and skilled laborers to build it.
Last year, Wisconsin passed a bill that would benefit data-center builders by exempting them from sales taxes for servers and other equipment-related sales costs.
Jim Grice, a partner with Akerman who leads the legal firm’s data center practice, said many states have adopted similar tax incentives.
“States that have passed these kinds of bills are getting more data centers than states that have not,” Grice said.
Write to Tom Dotan at tom.dotan@wsj.com