In this week’s newsletter, we talk about Big Tech’s bets on nuclear power, Netflix’s gaming studio, credit and more.
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Quote of the day 
“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.” – Albert Einstein
What is Big Tech’s rush to nuclear power telling us?
AI is changing the world in ways we couldn’t have imagined. But there’s a secret it’s keeping — its massive appetite for electricity.
Last year, AI alone gobbled up 4% of all electricity in the US, and by the end of the decade, that could shoot up to 9%.1 And with the power demand only surging, this is a problem we can’t ignore.
Now if you were to trace this energy consumption, you’ll find one word to blame this power surge on — data centres. Specifically, hyperscale data centres run by tech giants like Microsoft, Google, Amazon and OpenAI. These companies are the beating heart of AI but they are also responsible for 60-70% of all energy data centres use.1
To understand how this works, picture a massive room filled with computers, running 24/7, storing data, analysing it and making decisions. And to keep them from overheating, you need serious cooling. So technically, it’s like running a room full of ovens which need a lot of fans and air conditioning to make sure nothing catches fire. That’s the kind of power we’re talking about.
But mix AI with power, and you’ve got two serious issues to tackle. The first one is that AI is growing at breakneck speed. And the US is leading this growth, housing half of the world’s data centres — over 5,000 of them.2 And thanks to cloud computing which grows with AI; by 2030, the energy demand for these data centres is expected to triple.3
The second problem is emissions. If Big Tech needs to stay ahead in the AI race, it needs more data centres, which means more energy consumption. And that’s sort of complicating things because it has big promises to hit net-zero emissions by 2030.
So it’s turning to an unexpected old friend — nuclear power.
First up, we have Microsoft which is teaming up with partners to reopen nuclear facilities and ensure a steady power supply for its data centres. Then there’s Google, striking deals with startups to roll out small modular reactors. Amazon is also getting in on the action too, investing a whopping $500 million in nuclear-powered data centres. Clearly, Big Tech is betting big on nuclear energy.
But why nuclear, you ask?
Well, it all boils down to reliability. Nuclear reactors, particularly fission reactors, are workhorses of power generation. That’s because they generate energy by splitting atoms into smaller parts, producing a significant amount of energy that can run continuously for years, maintaining over 90% capacity, unlike solar or wind, which are at the mercy of the weather. That makes it a dependable choice for data centres that need a steady stream of energy 24/7. Besides, when you consider the costs of batteries needed to store renewable energy for those non-sunny or calm days, nuclear energy often comes out cheaper in the long run.
So, you could think of nuclear power like a reliable old car that always starts, even on a cold morning. On the other hand, solar and wind are like flashy sports cars. They’re fantastic when conditions are perfect, but you can’t always count on them. And that’s precisely why nuclear energy seems to be the steady, trustworthy option for tech companies that require constant power.
But if you go back in history, you might uncover a different story altogether. Nuclear energy hasn’t always had the best reputation. In fact, it’s often seen as a risky choice or one that can pose serious dangers and even take lives. For context, the US was once a nuclear powerhouse, leading the world in nuclear fuel exports. Over time though, it took a significant step back. The country went from mining uranium, crucial for fueling nuclear reactors, domestically to becoming the largest importer.
And fears of nuclear disasters like Chernobyl led to a halt on new nuclear projects, resulting in just 94 operational reactors today, down from a peak of 112 in 1990.
Cut to today, nuclear power contributes to about 20% of all electricity in the US. So, what changed?
Enter Small Modular Reactors (SMRs), which are giving nuclear energy a fresh new look. These smaller, supposedly safer reactors are not only easier to build but also come with a host of advantages. Imagine them as small, sturdy Lego blocks or components that can be manufactured in a factory and then assembled closer to where power is needed. This reduces safety risks compared to their larger, more complex predecessors.
And that’s also why companies like Google are ramping up efforts to build these reactors to fuel their AI ambitions, while Amazon is making significant investments in Virginia to power its data centres. This renewed focus is igniting significant changes in economies, major corporations and innovations themselves.
The buzz around nuclear energy has already sent US nuclear stocks soaring. Just look at NuScale Power, a company specialising in SMRs. Its stock has skyrocketed more than five times this year. Uranium prices are also reaching 15-year highs, benefitting companies like Cameco and NexGen that mine this crucial resource.3
And it’s not just happening in the US. If you shift your focus to India, you’ll see that it aims to triple its nuclear power capacity to 22,480 MW by 2032, with a goal of deriving 25% of its electricity from nuclear sources by 2050.
This ambitious drive is prompting significant investments, with power companies getting in on the action too. To put things in perspective, REC (Rural Electrification Corporation) plans to allocate ₹6 trillion to renewable and nuclear projects by 2030. NTPC is partnering with NPCIL (Nuclear Power Corporation of India) to form Anushakti Vidhyut Nigam, focusing on building and operating nuclear power plants. Add to this the fact that India plans to establish 10 new reactors and collaborate with private players to explore SMRs and innovate in nuclear technologies, and you’ll see how SMRs are changing perceptions of nuclear energy altogether.
And that might simply paint a rosy picture and make it seem like nuclear energy is a magic bullet that could help Big Tech give their AI dreams more wings while also minimising climate impact.
But let’s be real. It’s not that simple. There’s only a limited number of unused or inactive nuclear plants ready for a comeback, and building new reactors, whether they’re SMRs or not, comes with its own set of challenges.
You’ve got regulatory hurdles, engineering headaches and the tricky public perception to navigate. Plus, these new designs might still face hefty costs similar to larger units just to get the green light from regulators, especially in a field where safety is a top priority.4
And here’s another thing you can’t ignore. Investing in SMRs could divert funds away from tried and tested options like solar, wind and battery power systems. On the flip side, SMRs are a bit of an unknown because they’re still unproven.
But what’s innovation without tackling tough problems, right?
While the stakes are high, the potential is game-changing. And that could spark a simple hope for more nuclear breakthroughs rather than repeats of past disasters.
So yeah, maybe, just maybe, nuclear power can step into the spotlight without the shadow of doom and gloom headlines.
Until then stay tuned by subscribing to Finshots.
Story Sources: TechCrunch [1], Sherwood [2], Economic Times [3], Financial Times [4]
What happened to Netflix’s gaming ambitions?
A few years ago, Netflix decided to dip its toes into the gaming world. This was a completely uncharted territory for the streaming giant. But with streaming wars heating up and subscriber growth slowing, Netflix needed a fresh way to attract more users.
So, it turned to gaming. Instead of offering just movies and shows, subscribers could now play games, without paying anything extra.
And things moved quickly. Netflix rolled out a whole catalogue of games by setting up its own gaming studios across the globe. It even went on a bit of a shopping spree, acquiring companies like Finland’s Next Games, Texas-based Boss Fight Entertainment and Seattle’s Spry Fox.
Then, Netflix didn’t just stop at games which were based on its hit shows like Stranger Things. It also teamed up with big players like Rockstar Games — the folks behind Grand Theft Auto (GTA), and Hardlight Studios’ Sonic Dash series.
Things seemed promising. In 2021, Netflix games had over 5 million downloads. By 2022, that jumped to 28 million. And last year it hit a whopping 81 million downloads, which was a massive 180% year-over-year growth!1
Riding high on this success, Netflix set its sights even higher. It wanted to create brand new, multiplatform games that could be enjoyed on consoles, computers and mobile devices. These games wouldn’t be based on any of its existing shows or concepts, but something fresh and original.
But fast forward to today, and Netflix just pulled the plug on Team Blue, its AAA (Triple-A) gaming studio in Southern California, without ever releasing a single title.2 In simple terms, Netflix won’t be making any original blockbuster games anytime soon.
So, if Netflix wanted to go big on gaming, why would it hit the brakes like this, you ask?
Well, the truth is that Netflix’s gaming ambitions are still alive and kicking.
In fact, shutting down Team Blue might have been a wise decision after all.
You see, creating AAA games is no small feat. These are the big-budget titles produced or distributed by major publishers. And the term ‘AAA’ isn’t an acronym, it’s just a label for top-tier games. Developing them can get pricey. You need a standout game idea, a huge team of skilled developers and another army of people behind the scenes. Plus, there’s serious investments in graphics, visual effects and tech to make these games immersive and lifelike.
But here’s the thing. There’s no guarantee that they’ll be a hit. For these games to truly succeed, they need to resonate with gamers and be embraced as favourites.
Take GTA, for instance. It’s the poster child for AAA games or a blockbuster franchise that raked in over $9 billion from just its last two versions — GTA IV and GTA V.3 That’s around 25 times what Rockstar Games, the developers, spent on producing it! And that’s also why the GTA franchise was a key factor in Netflix gaming’s early success, accounting for about 17% of the platform’s gaming downloads in 2023.
But here’s the thing again. If Netflix’s AAA gaming experiment flopped, all that money spent on creating something fresh would go down the drain, especially considering the star-studded team it assembled. For context, it lured in heavyweights like Chacko Sonny, former executive producer of Overwatch, Joseph Staten from Microsoft’s Halo franchise and Rafael Grassetti, who was the art director at Santa Monica Studio, best known for God of War.
However, with all these high-profile employees now having left the streaming giant, Netflix may have realised something important. Pouring more money into replacing these key people and expanding the team to develop expensive games just doesn’t fit with its current strategy.
That’s because Netflix isn’t exactly going all out on producing new content right now.4 Sure, it has set aside about $17 billion for new projects in 2024, which is a solid one-third more than what it spent last year. But that’s still quite near or less than its peak spending of $17.5 billion back in 2021, during the pandemic’s heyday.
A big reason for this is the Hollywood Writers’ Strike. Writers felt that studios were cashing in big time on shows by distributing them to OTT platforms and other distributors, while they weren’t getting a fair share of these profits. This dispute slowed down content production across the board, impacting major players like Amazon, Disney, Fox, Warner Bros. Discovery and yes, Netflix too. As a result, Netflix released around 130 fewer original programs in 2023 compared to 2022 — a drop of about 16%.
But by slowly and gradually increasing its content budget, Netflix is probably embracing the “less is more” philosophy. That way instead of pouring money into a flood of average shows, it could create high-quality content that really makes an impact.
This approach also allows it to shift focus from simply adding subscribers to keeping viewers engaged.5 Think about it. When people find shows they love, they’ll stick around longer, recommend Netflix to their friends and see greater value in its service.
That’s also why Netflix has decided to stop publicly reporting its subscriber growth starting in 2025, and instead focus on metrics that highlight engagement. It’s all about creating a lineup of exceptional content that keeps audiences coming back for more.
And maybe Netflix wants to apply this same strategy to gaming as well. After all, it’s often cheaper to licence popular franchise games that gamers already adore than to gamble on developing original titles in-house. This way, Netflix can keep gamers engaged on its platform without a massive budget risk.
And who knows? This could translate into more subscribers and increased revenue, especially since only about 1% of Netflix’s subscribers currently play games.6
So no, Netflix isn’t throwing in the towel on its gaming ambitions. If anything, it’s taking a slow and steady approach to growth. And we’ll only have to wait and see how it all pans out.
Story Sources: Tech Crunch [1], Game File [2], Visual Capitalist [3], Sherwood [4], The Wrap [5], CNBC [6]
Quiz of the day
: Finance fundamentals
So, we heard y’all— the first ever FCW Quiz is here! Head over to this link and give it your best shot.
We’ll announce the winner next week, so keep an eye out! Good luck & Cheers 🙂
Money Myth Debunked 
You see, when used responsibly—such as making timely payments and keeping balances low—credit cards can actually help improve your credit score and build a positive credit history.
Here’s how:
1/ One key factor in credit scoring is the credit utilization ratio, which is the amount of credit you’re using compared to your total available credit. Not letting your credit utilization ratio get too high can actually help your credit score.
2/ Your payment history is the most significant factor affecting your credit score. If you make your credit card payments on time, this will have a positive effect on your score.
3/ Having a credit card contributes to your credit history. The longer your accounts are open and in good standing, the better it is for your credit score.
4/Credit scoring models favour a mix of credit types. Having a credit card alongside other types of credit (like loans and instalment credit) can enhance your credit profile, potentially improving your score.
Answer of the day: Aisa Yeh Jahaan. The film was directed by Biswajeet Bora and starred Palash Sen, Ira Dubey and Kymsleen Kholie. You can watch it on Youtube.
And that’s all for today folks!
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