China has faced problems with its state-supported data center buildout. People have jumped into data center construction without real industry knowledge. Utilization rates for some AI data centers were around 30% last year. “However, not all of the investment attracted by subsidies has been rational. Jin Yadong said that many computing centers rushed into construction are typically funded by a fragmented mix of private and municipal capital. “These investors tend to have plenty of money but little understanding of the industry, making it difficult for them to find suitable customers,” he said. These “outsider” investors, focused on short-term returns, often lack a deep understanding of trends in AI technology and fail to develop the necessary complementary industrial planning. As a result, some computing centers are built around a single performance metric, only to become “outdated as soon as they are completed.” They struggle to meet the market’s increasingly complex demand for AI computing, leading to an oversupply of low-quality computing capacity.” This piece from Science & Technology Daily is from last year but still relevant now: