Quantum’s big leap puts data centers in the spotlight

After decades largely confined to research labs, quantum computing may be closer to a breakthrough moment than many on Wall Street expect.

Technology that uses principles Quantum mechanics Solving problems beyond the capabilities of the most powerful classical supercomputers has long been touted as futuristic. But rapid developments have intensified investment in this sector and sparked discussions about how to integrate these powerful computers with industries such as the computer industry. Already thriving Data center sector.

“By the end of the decade, we are confident that we will have commercially valuable machines in data centers,” Zulfi Alam said. MicrosoftQuantum’s vice president told CNBC.

“I wouldn’t have been able to say this this clearly last year, but this year, I can say that by 2029, you will have commercially capable machines.” [value]“They will perform calculations that classical machines cannot do,” said Allam, who is leading the development of the company’s scalable quantum machine.

Classical computers use switches, or bits, to either pass or block an electrical current at any given moment to perform calculations. The more bits there are, the more computing power. Quantum computers, on the other hand, make use of the ability of some materials at very low temperatures to remain “on” and “off” at the same time. This allows quantum bits, or qubits, to perform the same calculations at much faster speeds.

Microsoft, which last year revealed a new Quantum computing chip The company, called Majorana, is among the companies that provide computing power that can scale quickly as demand rises. Google and Amazon This is it Invest heavily In technology.

He also sees hyperscalers and platform vendors increasing investment through cloud access, pricing controls and developer platforms, while the defense sector is investing early in both quantum computing and networking, said Patrick Moorhead, CEO and senior analyst at Moor Insights & Strategy.

Governments are increasing their investments as well, with China leading the way with just under $18 billion in public investment in quantum technology, closely followed by the European Union, according to the European Center for International Political Economy (ECIPE), a think tank.

Most industry roadmaps now place implementation of these systems in the 2028-2032 time frame, according to Eli Brown, quantum computing and cloud economics analyst at S&P Global Market Intelligence.

UBS sees the benefits of quantum computing arriving by the early 2030s, even with the company’s roadmaps for that earlier, UBS analyst Madeline Jenkins said. “A lot of companies are telling me that 2027 is going to be a big year for you in terms of the roadmap, in terms of what has been achieved,” she said.

Together, these timelines suggest that the sector is moving steadily toward real-world deployment, while raising important questions about how today’s data infrastructure will evolve to support it.

In a 103-page report published in January, UBS analysts led by Jenkins said… The industry is close to completion A quantum computer can cost tens of millions of dollars to build, but has the ability to solve a problem in 200 seconds that would take a traditional supercomputer 10,000 years.

When it comes to the impact on the data center ecosystem, experts told CNBC that quantum could reduce the power needs of power-hungry facilities while reducing the workloads needed to train AI.

In terms of power, quantum computing will require “a fraction of what a data center would use,” Jenkins said.

“The important thing is time; if you’re dealing with the same problem that might take thousands and thousands of hours, and you replace that with a quantum computer that takes seconds or minutes, then obviously you need a lot less power,” she said.

Microsoft’s Allam also noted the low power requirements of quantum computers, highlighting that Majorana 1 “demonstrates greater power than complete computations of the entire planet.” [in] The palm of your hand and it doesn’t get too hot. The weather is cold.”

While quantum technology is advancing rapidly, it is unlikely to replace the classical computing currently hosted in data centers in the near term.

“Ideally, the full efficiency of the problem-solving burden will be reduced, but it will not be a complete replacement,” S&P’s Brown said.

Microsoft’s Allam stressed that quantum systems will not operate in isolation. “A quantum machine is not an independent entity. It is a hybrid device. It is a quantum accelerator that needs a high-performance computer very close to it,” he said.

Moor Insights & Strategy’s Moorhead also noted that quantum metrics will likely play a complementary role, adding a new category of “private infrastructure” within data centers and shifting facility design toward “quantum pods” that come with their own power and heat needs.

“This will not replace the dominant energy driver in the near term, which is AI data center expansion, but it will add pockets of specialized loads and operational complexity,” he told CNBC via email comments.

Ultimately, it will likely change the shape of demand, but not its size, with the AI ​​boom remaining a major driver of demand for utilities.

There are only a few specialized quantum computers Currently deployed In data centers, where quantum vendors are currently brainstorming a set of industry standards to help simplify broader adoption, according to Brown and S&P analyst Kelly Morgan.

There is still a significant amount of custom work to be done in order to integrate quantum systems into data centers, Brown said, adding: “We lack some quantum talent to leverage that and install it effectively.”

But in the long term, she expects “a nice interaction between quantum and some other data center fields including artificial intelligence” where the two can work together to solve problems.

These obstacles reinforce the need for continued investment in data center infrastructure over the next decade, said Tim Adams, president and CEO of the Institute of International Finance.

“Data centers are essential to driving the technological transformation forward and should be considered one of a number of potential investments on the path to the very transformative breakthroughs we are certain we will see in the next 10-year time frame.” Adams told CNBC.

This phase has already begun, with Brown pointing to a wave of merger and acquisition activity aimed at building the capabilities needed for the quantum commercial phase.

“Mergers and acquisitions have been huge over the last three months,” Brown said, pointing to several acquisition announcements from Quantum. Ion Q. “There’s been a lot of positioning within the space to not only help optimize talent and quantum technology, but also to help control the supply chain a little bit.”

Besides the opportunities offered by quantum computing, when it comes to risks, data security is arguably the greatest.

According to UBS, a sufficiently powerful quantum computer could break existing encryption methods, meaning security systems would no longer be reliable. The report from the Swiss bank warns that companies will have to implement new quantum-secure encryption technologies, and that investment in them should start in the next few years.

Even with this increase in investments, Microsoft’s Allam warned that the road ahead will not be easy. It will take a lot of “blood, sweat and tears,” he said, anticipating many challenges as quantum machines emerge — from meeting performance standards to solving complex technical problems — all of which will need to “converge at the right time” for the real magic to happen.