Microsoft to invest $25 billion in Australian digital infrastructure, cybersecurity and workforce training

Microsoft has committed to invest $25 billion by the end of 2029 in new digital infrastructure in Australia including more local data centres, alongside new commitments to national cyber defence capability and workforce skilling programs.

The deal will see the software giant significantly expand its local Azure supercomputing and cloud infrastructure, and collaborate with the Australian AI Safety Institute and grow the Microsoft – Australian Signals Directorate “Cyber-Shield” to additional government agencies.

Also on the table is a deepened collaboration with the Department of Home Affairs, and an undertaking to equip three million Australians with workforce-ready AI skills.

Making the announcement was Microsoft chief executive Satya Nadella, in the country for the Sydney stop of the company’s global AI tour, and Prime Minister Anthony Albanese.

“We want to make sure all Australians benefit from AI,” Albanese said. “Our National AI Plan is all about capturing the economic opportunities of this transformative technology while protecting Australians from the risks.

“Microsoft’s long-term investment in our national capability will help deliver on that plan,” Albanese continued, “strengthening our cyber defences and creating opportunity for Australian workers and businesses,” he continued.

For his part, Nadella noted he believed Australia has an enormous opportunity to translate AI into real economic growth and societal benefit.

“[This] is why we are making our largest investment in Australia to date,” he said, “committing $25 billion to expand AI and cloud capacity, strengthen cybersecurity, and expand access to digital skills across the country.”

Expanding digital infrastructure

As well as using the $25 billion to expand the number of its local data centres, Microsoft has inked a Memorandum of Understanding with the Australian Government undertaking to meet the government’s recently released expectations around data centres and AI infrastructure developers.

These expectations are built around five priorities, including supporting Australia’s national interest; driving the clean energy transition; using water sustainably; investing in Australian skills and jobs; and strengthening local research and innovation capability.

While the infrastructure investment appears significant, recent reporting from The Sydney Morning Herald and others has found for every $100 spent on local data centre infrastructure, a significant percent of that spend flows back out overseas due to the cost of plant and equipment.

Australian Signals Directorate collab

The deal also sees an expansion in the Microsoft – Australian Signals Directorate Cyber “Shield” (MACS) partnership, originally inked in 2023.

Under the expansion, MACS will take in more federal agencies and departments. Microsoft claims since MACS’ inception, it has secured more than 38,000 government accounts, identified 35 previously unknown vulnerabilities, and delivered a bespoke engineering solution with Microsoft Sentinel.

Microsoft will also work with the Department of Home Affairs to create a shared approach to trusted private-public cooperation designed to strengthen Australia’s national and economic resilience.

Priority areas for engagement include connectivity, data and hyperscale cloud infrastructure resilience.

Talking up training

Microsoft said it train three million Australians with workforce-ready AI skills by 2028, building on its previous commitment to skill one million Australians and New Zealanders by 2025. The company claims it hit this target ahead of time.

It is also launching Microsoft Elevate for Educators, a free program Mirosoft pitched as a way to help teachers and school leaders use AI responsibly. A new partnership with Anyway is also bringing a free, AI-powered career coach to 1000 Australian schools.

Earlier this week, the AI Workers’ Summit, a collaboration between Microsoft and the Australian Council of Trade Unions (ACTU), was held and attended by the technology sector and Australian unions.