Microsoft data center push stalled by payment issues, Bloomberg reports

According to the latest report, a few data centers of Microsoft have been delayed in operations due to financial upheaval.

As reported by Bloomberg News, the Microsoft data center site in East Africa has been ‌delayed by disagreements with the Kenyan government over the company’s request for guaranteed payments.

In May 2024, Microsoft partnered with UAE-based AI firm G42 to invest $1 billion in a data center in Kenya as part of its efforts to expand cloud-computing services in East Africa.

The project was announced during Kenyan President William Ruto’s state visit to Washington under the Biden administration.

The facility was set to run entirely on geothermal power as well as provide access to Microsoft's Azure through a cloud region for East Africa.

Microsoft and G42 asked the Kenyan government to commit to paying for a certain amount of capacity ‌annually, but the talks broke down when it couldn’t provide the guarantees at the level Microsoft requested, the Bloomberg report said.

The report added that the group might ultimately decide to scale back the project.

Kenya is moving ahead with the talks, and “it has not failed or been withdrawn,” Bloomberg quoted principal secretary at Kenya’s Ministry of Information John Tanui as saying in an interview.

"The scale of the data center they wanted to do still requires some structuring," he said, adding that power requirements are still under discussion.

Notably, Microsoft, G42, and Kenya's Information Ministry did not immediately respond to the matter.