Tech giants Google & Meta sign $10 billion cloud deal spanning over six years

Chip Somodevilla/Getty Images News

Meta Platforms (NASDAQ:META [https://seekingalpha.com/symbol/META]) signed a major six-year cloud computing deal with Google (NASDAQ:GOOG [https://seekingalpha.com/symbol/GOOG]) Cloud, valued at over $10 billion, according to a report by _The Information._

Under the deal, Meta (NASDAQ:META [https://seekingalpha.com/symbol/META]) will utilize Google (NASDAQ:GOOG [https://seekingalpha.com/symbol/GOOG]) Cloud's servers, storage, networking, and related services, primarily to rapidly boost its AI capabilities while building out its own new data centers.

The contract marks a substantial win for Google (GOOG [https://seekingalpha.com/symbol/GOOG]) in the highly competitive cloud market, distinguishing it from leaders like AWS and Microsoft Azure.

The news comes after Meta (META [https://seekingalpha.com/symbol/META]) CEO Mark Zuckerberg earlier in July said that the business would invest hundreds of billions of dollars to construct a number of enormous AI data centers. Facebook-parent (META [https://seekingalpha.com/symbol/META]) has its massive data center projects ongoing, but many won't come online for years, making cloud partnerships critical for meeting immediate demand.

The deal is between long-time competitors (Meta and Google) in the online advertising space that are choosing to cooperate in the AI infrastructure space due to the scale of resources required.

MORE ON TECH GIANTS

* Meta Platforms: Every Dip Is A Long-Term Entry Opportunity [https://seekingalpha.com/article/4815747-meta-platforms-every-dip-is-long-term-entry-opportunity]
* Alphabet Q2: Don't Miss Out On This Growth Powerhouse [https://seekingalpha.com/article/4815671-alphabet-q2-dont-miss-out-on-this-growth-powerhouse]
* Alphabet: Market Acknowledging Moats, Stock Approaches Fair Value [https://seekingalpha.com/article/4815487-alphabet-market-acknowledging-moats-stock-approaches-fair-value]
* Meta's AI chief clears the air; says no slowdown in Superintelligence Labs investments [https://seekingalpha.com/news/4488098-metas-ai-chief-clears-the-air-says-no-slowdown-in-superintelligence-labs-investments]
* AI startup Anthropic plans to raise up to $10B in new funding round: report [https://seekingalpha.com/news/4488032-ai-startup-anthropic-plans-to-raise-up-to-10b-in-new-funding-round]