Just wanted to add a correction to my previous comment. Microsoft to date has only purchased 1672 acres (2.61 sq miles) of land in Mt. Pleasant - not 2250 acres. Still, within the next week, grading wil begin on the final portion of the initial $3.3B phase of the project. This phase will be completed by 2026, and include at least 12 buildings totaling 4.1 million square feet which already would make it the second largest data center complex in the US. In May, (at which time Microsoft's land holdings totaled only 1395 acres) it was estimated the total investment on that amount of property could reach $10B. With the additional land purchases since May, the total potential investment is now likely around $12B or more. There's another 1700 or so acres of farmland directly south of the Foxconn and Microsoft combined holdings that would seem ideal for further expansion of the technology park. The next few years should be exciting as Microsoft's plans continue to evolve. Could it end up being the site for a rumored $110B data center planned by Microsoft complex to host ChatGDP.
One of ironies is that in part due to the network effect you described, and the personal connections of Microsoft's two current top executives to SE Wisconsin, we've managed to transition our hopes for a high-tech future from Foxconn (which made a net profit of $4.5B on $198B in revenue in 2023) to Microsoft (which made a net profit of $72.4B on only slightly greater revenue of $212B last year). Microsoft is in vastly superior position to follow through on its capital investment plans.
Another interesting wrinkle is that Foxconn is the world's leading manufacturer of data infrastructure products and Mt. Pleasant (where they have still managed to invest $1B) remains their primary US facility with the main products at present being data infrastructure products. So there could end up being some further synergies between Foxconn and Microsoft's plans, and a further unique advantage this data center could have over every other in the US.
I’m reminded of an article by Jim Russell making the case that “Brain Drain is Economic Development” (When Leaving Home Is Good for the Hometown - Pacific Standard (psmag.com)).
“For a developed tech market such as Boston, little would be gained from losing talent to Silicon Valley. For a developing tech market such as Minneapolis, much could be gained from losing talent to Silicon Valley or Boston. Similarly, talent just graduating from college is relatively undeveloped. The migration from a place of talent production to a talent refinery such as New York City could benefit both migrant and source town, as well as the destination. Regardless, the hometown girl gains knowledge in a global city that she was unable to glean where she grew up. For the place left behind, it must figure out how to tap that experience and promote its own economic development.”
Essentially brain drain from Midwestern universities in theory should in the long run be helping to build our network with the coastal cities. This certainly seems to be the case with another high-tech project currently underway on the west side of Lake Michigan, namely the construction by Microsoft in Mt. Pleasant, Wisconsin, of what reportedly will be one of the largest and most advanced AI and cloud data centers in the world. As of July 2024, Microsoft has acquired >2,250 acres of land in Mt. Pleasant for its planned campus (including a large portion of the failed Foxconn project site). The selection of this location was in part a result of Microsoft President, Brad Smith’s connections to Wisconsin (born in Milwaukee and raised in Appleton). Like the PsiQuantum project, access to water from Lake Michigan water was a factor as well. (Building a data center economy: Microsoft’s Mount Pleasant project could be game changer for Wisconsin (biztimes.com)).
The 2000 construction jobs over the next decade and the 2000 reported permanent jobs are exciting (although I think everyone in Wisconsin is a little skeptical about forecasts of jobs for this site after the Foxconn debacle). But what is perhaps more exciting in terms of innovation and long-term impact is that the project is paired with the creation by Microsoft of an AI-Co Innovation Lab at UW-Milwaukee, which will join six other similar labs created by Microsoft around the world, but be only the third in the US (with the others in San Francisco and Redmond), and be the first dedicated to the manufacturing industry as well as the first on a university campus. The AI-Co Innovation labs are intended to give businesses a space to build, develop, prototype and test their AI-centered solutions. With the scale of Microsoft's reportedly investments in AI, there would appear to be a strong incentive for making these centers as impactful as possible - and Microsoft has the money and expertise to make this happen.
Milwaukee-area manufacturing businesses are already "all-in" on AI in terms of building the data centers themselves, with Johnson Controls reporting over $2 billion in revenue in the past year linked to data center projects, and Milwaukee Tools developing a new line of tools specifically for work on data center construction and maintenance projects. But the lab will provide opportunities for further innovation of what are already highly innovative companies (with Milwaukee Tools averaging 1 patent per week).
The decision to create the lab at UW-Milwaukee is without question another example of the benefits of "Midwest brain drain" with the key connection being the school’s link to Satya Nadella, Microsoft’s CEO, who earned his master’s degree in computer science at UW-Milwaukee in 1990, and who has personally donated $2 million to the school to support efforts to recruit retain and graduate undergraduate students from marginalized and underserved communities, preparing them with the skills to pursue careers in computer science, data science and information technology.
Just wanted to add a correction to my previous comment. Microsoft to date has only purchased 1672 acres (2.61 sq miles) of land in Mt. Pleasant - not 2250 acres. Still, within the next week, grading wil begin on the final portion of the initial $3.3B phase of the project. This phase will be completed by 2026, and include at least 12 buildings totaling 4.1 million square feet which already would make it the second largest data center complex in the US. In May, (at which time Microsoft's land holdings totaled only 1395 acres) it was estimated the total investment on that amount of property could reach $10B. With the additional land purchases since May, the total potential investment is now likely around $12B or more. There's another 1700 or so acres of farmland directly south of the Foxconn and Microsoft combined holdings that would seem ideal for further expansion of the technology park. The next few years should be exciting as Microsoft's plans continue to evolve. Could it end up being the site for a rumored $110B data center planned by Microsoft complex to host ChatGDP.
One of ironies is that in part due to the network effect you described, and the personal connections of Microsoft's two current top executives to SE Wisconsin, we've managed to transition our hopes for a high-tech future from Foxconn (which made a net profit of $4.5B on $198B in revenue in 2023) to Microsoft (which made a net profit of $72.4B on only slightly greater revenue of $212B last year). Microsoft is in vastly superior position to follow through on its capital investment plans.
Another interesting wrinkle is that Foxconn is the world's leading manufacturer of data infrastructure products and Mt. Pleasant (where they have still managed to invest $1B) remains their primary US facility with the main products at present being data infrastructure products. So there could end up being some further synergies between Foxconn and Microsoft's plans, and a further unique advantage this data center could have over every other in the US.
I’m reminded of an article by Jim Russell making the case that “Brain Drain is Economic Development” (When Leaving Home Is Good for the Hometown - Pacific Standard (psmag.com)).
“For a developed tech market such as Boston, little would be gained from losing talent to Silicon Valley. For a developing tech market such as Minneapolis, much could be gained from losing talent to Silicon Valley or Boston. Similarly, talent just graduating from college is relatively undeveloped. The migration from a place of talent production to a talent refinery such as New York City could benefit both migrant and source town, as well as the destination. Regardless, the hometown girl gains knowledge in a global city that she was unable to glean where she grew up. For the place left behind, it must figure out how to tap that experience and promote its own economic development.”
Essentially brain drain from Midwestern universities in theory should in the long run be helping to build our network with the coastal cities. This certainly seems to be the case with another high-tech project currently underway on the west side of Lake Michigan, namely the construction by Microsoft in Mt. Pleasant, Wisconsin, of what reportedly will be one of the largest and most advanced AI and cloud data centers in the world. As of July 2024, Microsoft has acquired >2,250 acres of land in Mt. Pleasant for its planned campus (including a large portion of the failed Foxconn project site). The selection of this location was in part a result of Microsoft President, Brad Smith’s connections to Wisconsin (born in Milwaukee and raised in Appleton). Like the PsiQuantum project, access to water from Lake Michigan water was a factor as well. (Building a data center economy: Microsoft’s Mount Pleasant project could be game changer for Wisconsin (biztimes.com)).
The 2000 construction jobs over the next decade and the 2000 reported permanent jobs are exciting (although I think everyone in Wisconsin is a little skeptical about forecasts of jobs for this site after the Foxconn debacle). But what is perhaps more exciting in terms of innovation and long-term impact is that the project is paired with the creation by Microsoft of an AI-Co Innovation Lab at UW-Milwaukee, which will join six other similar labs created by Microsoft around the world, but be only the third in the US (with the others in San Francisco and Redmond), and be the first dedicated to the manufacturing industry as well as the first on a university campus. The AI-Co Innovation labs are intended to give businesses a space to build, develop, prototype and test their AI-centered solutions. With the scale of Microsoft's reportedly investments in AI, there would appear to be a strong incentive for making these centers as impactful as possible - and Microsoft has the money and expertise to make this happen.
Milwaukee-area manufacturing businesses are already "all-in" on AI in terms of building the data centers themselves, with Johnson Controls reporting over $2 billion in revenue in the past year linked to data center projects, and Milwaukee Tools developing a new line of tools specifically for work on data center construction and maintenance projects. But the lab will provide opportunities for further innovation of what are already highly innovative companies (with Milwaukee Tools averaging 1 patent per week).
The decision to create the lab at UW-Milwaukee is without question another example of the benefits of "Midwest brain drain" with the key connection being the school’s link to Satya Nadella, Microsoft’s CEO, who earned his master’s degree in computer science at UW-Milwaukee in 1990, and who has personally donated $2 million to the school to support efforts to recruit retain and graduate undergraduate students from marginalized and underserved communities, preparing them with the skills to pursue careers in computer science, data science and information technology.