Nvidia hits back at US data center gloom with plans to repurpose old telephone and telecom buildings owned by Brightspeed into small AI data centers

Nvidia is exploring an unconventional strategy by converting Brightspeed's struggling telecom properties into small AI data centers. This move could extend Nvidia's expansion across up to 20 states, potentially utilizing over 130 existing buildings for compact regional computing operations. Brightspeed, a broadband operator backed by Apollo Global Management, is reportedly close to bankruptcy but possesses approximately 1 gigawatt of electrical capacity, making it an attractive prospect for Nvidia's next-generation server systems.

The proposal, reportedly discussed with Apollo, aims to address the concerns around data center expansion, as retrofitting existing facilities may face fewer planning obstacles than building entirely new structures. Nvidia's proposed "inference network" would focus on running models that have already completed initial training, potentially appealing to cloud operators and AI developers needing computing capacity closer to customers and existing networks.

However, the commercial and operational feasibility of this plan remains uncertain, with questions about the number of properties to be converted, equipment ownership, and potential customers. The news of this potential conversion comes amid a 9% decline in Nvidia shares during Thursday's trading session, marking the steepest daily drop since January 2025.