JP Morgan spent $2bn in 2021 on data centers, driven by edge requirements

JP Morgan spent $2bn in 2021 on data centers, driven by edge requirements

JP Morgan made an interesting disclosure on its latest earnings call — the Wall Street behemoth spent $2bn on brand new data centers at a time when many enterprises are doing the exact opposite. Executives explained that the new builds are necessary for expansion into new markets like the UK. The news shows that data sovereignty — a key driver of edge computing in general — is shaping up to be a big driver of regional infrastructure builds, especially for financial institutions.

JP Morgan’s $2bn data center budget represents a large slice of its 2021 technology spend which was $12bn, and as always with numbers of this kind, needs qualification. Most of the investment in data centers is in applications, so it is a fair bet that the $2bn covers much more than space and power.

CEO Jamie Dimon talked about how much benefit he expects to see from the company’s various cloud projects. He says that will be $30-40mn, a pretty small number in comparison to the $12bn IT budget.

“I want the $30mn but that is not why we are doing it,” Dimon commented. It’s not that  JP Morgan is hostile to the cloud; Dimon says between “30 and 50 percent” of the company’s apps will be moving to the cloud.

Dimon even had some words of praise for its mainframe estate. “Our credit card business runs a mainframe which is quite good. It handles 60 million accounts efficiently and economically and has been updated recently,” he told analysts on a conference call.

JP Morgan’s equivocal approach to the cloud displeased the investment community, and apparently caused the stock to drop, but Dimon’s assessment of his IT estate should give public cloud advocates pause for thought.

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