China Mobile orders $4.3B in servers as it ramps up AI infrastructure

China Mobile has ordered 31 billion Chinese yuan (US$4.3 billion) in new servers as it plows ahead with its AI infrastructure buildout.

In the latest procurement round, it has finalized a RMB16 billion ($2.2 billion) order for 265,000 servers, most of which will be supplied by local firms ZTE, H3C and xFusion.

It reportedly also issued a RMB15 billion ($2.1 billion) tender for around 8,000 AI servers on April 18, covering its needs for the next two years. 

The operator last month commissioned its largest ever intelligent computing center in Hohhot, Inner Mongolia, said to be the biggest to be operated by a telco. The new center, one of 12 so far completed, is capable of up to 6.7 Eflops. Besides enabling advanced computing and storage, it uses new technologies including high-speed lossless networks and cold plate liquid cooling.

The drive into computing is reflected in China Mobile’s capex. 

Localization efforts 

While total spending is slightly lower this year, it has boosted computing investment by 21% to 47.5 billion yuan, accounting for 27% of the total. Through this, the company aims to increase its computing capacity from 8 Eflops to 9 Eflops and its intelligent computing capacity from 10 Eflops to 17 Eflops.

Chairman Yang Jie told a digital infrastructure conference last month the company had "transitioned from cloud to computing." He said the operator would build national, provincial, and prefecture-level computing platforms to support the distribution of computing power around the country.  

These big investments also underpin China’s hi-tech localization efforts. In the AI procurement, more than 85% of the chips are to be locally sourced, while in the next tender round it’s expected China's domestic chip architectures will largely replace x86.

The telco is also a global leader in the shift away from traditional connectivity business, with Omdia (Light Reading's sister company) placing it first in its telco-techco transformation index.

This is apparent in its financial filings, which show its cloud and enterprise businesses on a fast growth track. Enterprise revenue last year grew 14% to RMB192 billion ($26.6 billion), nearly a fifth of total revenue. The cloud business, including both consumer and enterprise, grew 83%.