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Cisco unveils AI-focused chip to link massive data centers

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Cisco Systems has introduced a new networking chip, the P200, designed to connect large-scale AI data centers across vast distances. The technology, which will power a new generation of high-capacity routers, has already attracted major clients including Microsoft Azure and Alibaba Cloud, the company announced Wednesday.

The P200 aims to solve a growing challenge in artificial intelligence — connecting geographically distant data centers so they can operate as one massive computing system. “AI training jobs are now so large, they require multiple data centers working together — even a thousand miles apart,” said Martin Lund, Cisco’s executive vice president of common hardware.

The chip consolidates what previously required 92 separate components into one, allowing routers to use 65% less power. Cisco said the innovation helps AI firms manage rising energy demands as data centers spread to regions such as Texas and Louisiana, where electricity is more abundant.

The P200 will compete directly with Broadcom’s networking chips, offering faster data synchronization and more efficient buffering technology, a crucial feature for ensuring AI workloads remain stable across distributed systems.

Industry leaders including Microsoft’s Dave Maltz praised the move, saying the chip provides “faster networks with more buffering to absorb bursts of data,” critical for scaling AI operations. Cisco did not disclose investment costs or revenue expectations but said the chip represents a major leap in AI infrastructure efficiency.

Databricks Partners with OpenAI to Deliver Enterprise AI Models

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Databricks announced on Thursday a partnership with OpenAI to bring the ChatGPT maker’s artificial intelligence models directly into its platforms for enterprise clients.

Under the deal, OpenAI’s models will be integrated into Databricks’ cloud-based analytics platform as well as its flagship Agent Bricks product, which helps businesses design, test, and scale custom AI applications and agents. The agreement is expected to generate $100 million in revenue, according to Databricks.

The move marks another step in OpenAI’s expansion beyond its long-time cloud partner Microsoft Azure, as it seeks to accelerate adoption of its tools among corporate users. For Databricks, the deal strengthens its hand against rival Snowflake, which is still in early development of its AI services.

“We’re seeing overwhelming demand from enterprise customers looking to build AI apps and agents on their data, tailored to their unique business needs,” said Databricks CEO Ali Ghodsi.

OpenAI’s GPT-5 will serve as a flagship model for more than 20,000 Databricks enterprise customers, the company said.

The agreement builds on an existing partnership: OpenAI already uses Databricks to process AI data, which supports improvements in ChatGPT. Databricks was also among the first to host gpt-oss, OpenAI’s open-weight models that specialize in advanced reasoning.

The announcement comes shortly after Databricks closed a $1 billion funding round, pushing its valuation to $100 billion and securing its place among the world’s most valuable private tech firms.

Google Ends Some Cloud Data Transfer Fees in EU and UK Ahead of Data Act

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Google announced Wednesday it will eliminate certain cloud data transfer fees in the European Union and Britain, just days before the EU Data Act takes effect on Friday.

Key Details

  • What’s changing?
    Google will no longer charge organizations for transferring data between Google Cloud and other providers under its new “Data Transfer Essentials” offer.

  • Why now?
    The EU Data Act requires providers to allow switching between clouds more easily, permitting them to charge transfer fees only “at cost.”

  • How Google differs:
    Unlike rivals, Google is offering these transfers at no cost, going beyond the minimum legal requirement.

Competitor Moves

  • Microsoft introduced at-cost fees in the EU last month.

  • Amazon Web Services (AWS) allows EU customers to request reduced data transfer rates in eligible cases.

Strategic Context

  • The cloud market remains dominated by AWS, Microsoft Azure, and Google Cloud, but regulators in both the EU and UK are intensifying scrutiny over competition.

  • Britain’s antitrust watchdog recently criticized Microsoft’s licensing practices for disadvantaging smaller providers.

Why It Matters

  • Many organizations rely on multicloud strategies for resilience and flexibility, making transfer costs a significant factor.

  • By scrapping fees entirely, Google is positioning itself as the most customer-friendly provider ahead of stricter EU oversight.