Google’s investments in AI are centered on enhancing technical infrastructure, according to Google APAC head of AI and emerging tech policy Eunice Huang.

Huang made this statement on July 9, 2025, during a panel discussion at the Reuters NEXT Asia summit in Singapore.

Huang cited Google CEO Sundar Pichai, who said that the risks of under-investing in AI during this transformative period are greater than the risks of over-investing.

In April, Google’s parent company Alphabet confirmed its plan to spend US$75 billion in 2025 to expand data center capacity.

This comes despite challenges such as US tariffs.

The company also aimed to reassure investors regarding the expected returns on its AI strategies.

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🔗 Source: Reuters

🧠 Food for thought

1️⃣ Google’s infrastructure investment continues a decade-long AI strategy

Google’s current $75 billion commitment to data center capacity builds on a consistent, long-term AI investment approach that began years ago.

The company has been strategically positioning itself as an “AI-first” organization since at least 2017, when it published 218 machine learning research papers—nearly double its output from just two years earlier 1.

This research investment was complemented by strategic acquisitions, most notably DeepMind for $400 million in 2014, which dramatically expanded Google’s AI capabilities in areas ranging from gaming to healthcare applications 2.

Google’s approach has always balanced pure research with commercial applications, establishing research initiatives like People + AI Research (PAIR) while simultaneously integrating AI into core products 3.

The current infrastructure focus represents the logical next phase, scaling up computing capacity to support increasingly complex AI models and services that require massive computational resources.

2️⃣ Tech giants’ AI infrastructure race drives unprecedented capital expenditure

Google’s $75 billion commitment to data centers reflects a broader industry pattern where infrastructure has become the critical battleground for AI dominance.

Public cloud vendors collectively are planning more than $250 billion in AI infrastructure investments for 2025, with Google’s parent Alphabet joining Amazon and Microsoft in this capital-intensive competition 4.

This infrastructure arms race is driven by projections that the AI market will grow at a compound annual rate exceeding 18%, with generative AI services specifically expected to grow at an extraordinary 75% CAGR 5.

The scale of these investments illustrates how AI computing infrastructure has become both a competitive necessity and potential moat for major tech companies, requiring massive upfront capital that smaller competitors cannot match.

Cloud providers expect significant returns on these investments, with AI-related cloud services projected to reach a $20 billion revenue run rate by 2024 4.

3️⃣ Strategic risk calculus balances over-investment against competitive irrelevance

When Google’s CEO states that “the risks of under investing are dramatically higher than the risks of over investing,” this reflects a calculated approach to managing AI innovation uncertainty.

In the rapidly evolving AI landscape, companies that hesitate risk being left behind—a perspective supported by the surge in AI venture capital deals, which reached $368.5 billion globally in 2024 5.

This approach acknowledges the genuine financial risks of over-investment, including high valuation bubbles and technological uncertainties that could lead to stranded assets if certain AI approaches prove unviable 6.

However, the alternative—technological obsolescence—represents an existential threat that could undermine Google’s core business model, which increasingly depends on AI capabilities for everything from search to cloud services 7.

This risk assessment reflects how the competitive dynamics of AI have created a high-stakes environment where major players must place enormous bets despite uncertainty about which specific applications will ultimately generate returns.

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