Data center builder Nscale Global Holdings Ltd. today announced plans to acquire Anyscale Inc., a venture-backed provider of artificial intelligence software.

The terms of the deal were not disclosed. Bloomberg cited a source as saying that Nscale is paying $1.65 billion. In March, the company raised $2 billion from a consortium that included Nvidia Corp. and other major tech firms.

London-based Nscale is building a network of AI data centers that will span a half-dozen countries. Its flagship development is a 2,250-acre campus in Mason County, West Virginia that features its own miniature power grid. The company estimates that the site can theoretically host more than eight gigawatts worth of computing capacity.

Anyscale, the startup that Nscale has agreed to buy, was launched in 2019 by a group of computer scientists. It commercializes an open-source project called Ray that was created by its founding team. The software is used to optimize large-scale AI clusters.

Distributing an AI workload across multiple servers is not as simple as splitting it into smaller tasks and running each one on a separate machine. Developers must make numerous optimizations to ensure that the cluster will run reliably. Additionally, they must fine-tune its performance to avoid cost overruns and underutilized hardware. Ray eases the task.

One of the chores that the software streamlines is mitigating hardware errors. If one of the servers in a cluster fails during an AI training run, Ray can automatically replace it with a new machine. That removes the need to write custom fault tolerance workflows. 

The software also helps developers reduce bandwidth costs. If an AI model and the dataset that it uses are stored on two separate servers, the machines must regularly exchange information over the network. Ray installs AI models and their datasets on the same machine to avoid unnecessary traffic.

Anyscale commercializes the project with a paid cloud-based version. The service provides access to managed Ray clusters that developers can launch in under a minute. Additionally, it features monitoring dashboards that ease the task of troubleshooting technical issues.

Nscale expects to close the acquisition by year’s end. The company plans to offer Anyscale’s software to its customers alongside its internally developed infrastructure optimization tools. Nscale provides managed versions of Kubernetes and Slurm, two open-source tools likewise designed to automate server cluster management. 

“We build and own every layer ourselves: the power, the data centers, the compute, and the software that turns them into an AI cloud,” said Nscale founder and Chief Executive Officer Josh Payne. “Anyscale extends that offering with managed services that AI teams use to scale any workload, completing a truly vertically integrated AI cloud platform.”

Photo: Nscale