Hi, this is Caroline Hyde from Bloomberg Tech.

Today, we're sharing something a little different in your feed, an episode from our colleagues

at Here's Why, Bloomberg's weekly show that answers one big question in under 10 minutes.

Host Stephen Carroll is joined by our Bloomberg Tech Eurobanker, Tom McKenzie, to dive into a story

that's right at the heart of the tech world, the massive

investments in AI data centers and the hidden costs that come with them. If you'd like to hear more

episodes of Here's Why, you'll find a link to the podcast feed in the show notes. Hope you enjoy.

Bloomberg Audio Studios.

Podcasts, Radio News.

I'm Stephen Carroll and this is Here's Why, where we take one news story and explain it in just a few minutes with our experts here at Bloomberg.

It's 10.30 p.m. in this AI party. It started 9 p.m. and that party goes to 4 a.m. And the reality is like, look, this is going to be a two to three year left in this bull cycle for tech.

The tech sector is very strong because artificial intelligence is really a qualitative leap in the kind of technology

that we've had over the last several decades.

You're seeing an exponential growth of adoption and use of AI.

The number of applications that are going to be using these AI is also growing.

Everyone has an opinion on where the AI frenzy is going next.

But while optimism is rampant about the technology's potential, more questions are now

being asked about AI's running costs.

We are putting mostly chips, silicon, into these data centers that have a lifespan of perhaps

four years. Those chips, they depreciate very quickly.

Even in Vida, there's a new chip every 18 months, and it's 10 times as powerful as the earlier

ones. The thing with the rally this year is that almost every investor knows it's all going to turn

...