Wed, 14 Jan 2026

Wed, 14 Jan 2026 Honey, I shrunk the data centres: Is small the new big?

Huge data centres are being built to handle AI computing but some experts say they aren't necessary.
A data centre industry expert says it's a long-term "if and when" powerful and efficient AI can run on local devices. Meanwhile, the data centre sector is not shrinking in terms of demand but some companies are exploring smaller, more energy-efficient alternatives. Tiny data centres, no larger than a washing machine, are being operated in various locations around the world, including homes and public buildings. Tech companies are investing billions of dollars in massive data centre plants despite concerns about their environmental impact. A shift towards "smaller 'edge' data centres near large populations" could reduce latency and result in faster response times. Some experts suggest that every public building should house a small data centre, working in a network with each other where required, and providing heating as a by-product. The move away from massive data centres could have significant environmental benefits, but also raises concerns about national security. Small targets may be less of an impact if penetrated, while larger centres can be big points of failure. Businesses are increasingly opting for bespoke enterprise AI tools instead of generic ones, which tend to perform more accurately and require less computing. This trend towards smaller, private AI tools could further reduce the need for massive data centres in the future.
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