2025: AI Becomes Core of Business and Cloud Infrastructure

What happened: In a cluster of year‑end deals, Alphabet agreed to buy energy and data‑center power firm Intersect Power for $4.75 billion to secure capacity for AI workloads (TechCrunch, AP News, Dec. 22, 2025). Reuters reports SoftBank is nearing a deal to buy data‑center investor DigitalBridge (Dec. 29, 2025). Indian IT firm Coforge is set to acquire software engineering shop Encora for $2.35 billion to expand AI services (Reuters, Dec. 26, 2025).

Technical context: These transactions cover the three primary inputs large language models need: power, physical capacity, and engineering talent. Alphabet’s Intersect purchase targets grid and on‑site generation limits that constrain usable compute. DigitalBridge would increase institutional control of colocated racks and network capacity. Coforge’s acquisition brings development teams and IP for building and deploying model‑centric applications. Each announcement links the deal directly to supporting AI scale and reliability (TechCrunch; AP; Reuters).

Implications: Expect continued verticalization of cloud stacks as hyperscalers and investors lock up energy and real estate while systems integrators consolidate AI engineering talent. IT leaders should convert this trend into concrete plans for power and floor‑space capacity, vendor‑risk reviews, and faster investment in model operations and data pipelines.

Why It Matters

• Plan capacity beyond GPUs: reserve power, cooling and floor space in vendor and site budgets to avoid compute bottlenecks.
• Assess vendor consolidation risk: M&A is concentrating AI engineering services — review single‑vendor dependencies and contract terms.
• Prioritize MLOps and data pipelines: acquisitions signal demand for turnkey AI delivery; accelerate tooling, CI/CD and data readiness to capture that demand.