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Why Amazon is now spending more on data centers than on e-commerce warehouses

AI is where the growth is.

7/1/24 9:51AM

Amazon, the company known quickly shipping goods to consumers from its online marketplace, is now spending more money on data centers than e-commerce warehouses, according to The Wall Street Journal. Why? In short: AI.

ISO its next “pillar” of growth

For years the company has been searching for its next “pillar of growth” to add to its first three pillars: its online marketplace, Amazon Prime membership program, and cloud-computing business Amazon Web Services. It’s hoping artificial intelligence will be a big part of that growth.

Build your own instead of competing for space

Access to data centers is a key battleground for those hoping to compete in AI, because the tech requires so much computing power.

According to a new report by real estate services company CBRE, “Large corporations face increasing difficulty securing data center capacity.” An astonishing rate of data center space is being leased before it’s even built.

So Amazon is spending even more on its own data centers in order to compete. Amazon plans to add at least 216 new data-center buildings in the next several years, according to WSJ reporting.

Everyone else is doing it

Amazon is clearly not the only one looking to AI for growth. A number of major tech companies are investing record sums on capital expenditure thanks to AI. (Companies in general can’t stop talking about AI and the topic reeks of FOMO)

Chris Stokel-Walker

Bot bias

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Prediction markets have, predictably, been given a boost by the summer of sports

Major platforms like Kalshi and Polymarket have seen huge upticks in users of late, thanks in no small part to what’s felt like a recent sporting smorgasbord, with major competitions across hockey, basketball, and soccer soaking up fans’ time (and spending, clearly) at the outset of summer.

While gaming industry groups may not like it, there’s been a huge change in the methods people are using to put money on the big games, with everyone from fortunate NYC bar owners, to a far less fortunate Spanish supporter, turning to prediction markets to try and turn their sports know-how into cold, hard cash.

According to a new report from Adam Blacker for apptopia, that shift might have been even more seismic than imagined in the wake of the NBA and NHL finals and around the 2026 World Cup kicking off.

2026 World Cup Reverses Seasonal Lull for Sports Betting Apps

According to a new report from Adam Blacker for apptopia, that shift might have been even more seismic than imagined in the wake of the NBA and NHL finals and around the 2026 World Cup kicking off.

South by Southwest Conference and Festivals

Gold Tesla Cybercabs are piling up, but they’re not picking up passengers yet

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TAKING ACCOUNTS

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Anthropic pulls Fable and Mythos access worldwide after Trump administration bars their use by foreign nationals

Only days after releasing two versions of its next-gen AI model, Anthropic has disabled them for users worldwide.

Anthropic says it received a Friday night order from the Trump administration to suspend access to the models for any foreign national (anywhere in the world) — a group that included some Anthropic employees. In response, the company turned off access to everyone.

Last week, the company released to the public its much-anticipated Claude Fable 5 model (and its restricted version Claude Mythos 5, which is still being tested with trusted partners). Anthropic said in a blog post announcing the action that officials cited national security concerns with the new models, while offering few specific details.

The post said that the government gave the company “verbal evidence of a potential narrow, non-universal jailbreak” of the public Fable 5 model. A jailbreak is a means by which users can evade restrictions built into the code to unlock prohibited functionality. Anthropic downplayed the significance of the attack, and said other major models, such as OpenAI’s GPT-5.5, could also be affected by the technique described.

Fears of these first Mythos-class models being misused are running high, after Anthropic warned the cybersecurity world in May that the advanced cyber capabilities of Mythos have rapidly discovered thousands of vulnerabilities in ubiquitous software, leading to the decision to restrict the full version of the model to a close group of trusted partners for testing.

This morning, Axios reported that Anthropic technical staff have flown to Washington to meet with White House officials to resolve the issue.

The Wall Street Journal is reporting that the Trump administration’s decision to take action against Anthropic was prompted by discussions that Amazon CEO Andy Jassy had with officials, including Treasury Secretary Scott Bessent. According to the report, Amazon researchers said they had been able to evade some of Fable 5’s security restrictions using specific prompts. Amazon is a major investor in Anthropic.

Anthropic is currently suing the US government to fight the Pentagon’s blacklisting of the company on national security grounds.

Statement on the US government directive to suspend access to Fable 5 and Mythos 5