Shanghai-based social media platform RedNote, known as Xiaohongshu in China, is planning to develop a large-scale data centre facility in the Inner Mongolia autonomous region, according to a source familiar with the project. The move is part of a broader national push to build advanced artificial intelligence (AI) infrastructure.
The proposed facility, expected to have a capacity of 600 megawatts, is slated for either the Ulungqbq area—renowned for its abundant wind and renewable energy resources—or a location west of the region’s main city. The estimated investment for the project is approximately 15 billion yuan (about HK$17.4 billion), excluding semiconductor expenses. RedNote is reportedly in discussions with VNET, one of China’s largest data centre operators, regarding the development, with a target completion date set for the first quarter of 2027.
The wider context for the initiative is China’s significant investment plan in computing infrastructure. The National Development and Reform Commission (NDRC) announced recently that the country aims to allocate roughly 4 trillion yuan over the next five years to enhance its national computing network as part of the 15th Five-Year Plan. While much of this investment is expected to come from private enterprises, the government plans to promote an environment conducive to increased private sector participation in the computing and data centre industry.
RedNote’s expansion reflects an intensifying competition among Chinese internet companies to boost their computing capacities to support AI integration in their services. The platform, which lets users share product reviews, travel tips, and lifestyle content, has also developed an AI assistant named Diandian. This tool provides content summarisation, personalised recommendations, and travel planning for users. Notably, one of RedNote’s AI models recently achieved a perfect score at the International Mathematical Olympiad, marking a first for an AI system at this prestigious competition.
The development aligns with a broader trend as several Chinese tech firms accelerate efforts to strengthen AI infrastructure. For example, Zhipu AI has established a 1-gigawatt AI computing centre powered exclusively by Chinese-made chips for training and deploying its GLM models. Frontier AI research lab DeepSeek has also begun recruiting staff to manage data centre operations in Inner Mongolia’s Ulungqbq area.
Inner Mongolia has emerged as a strategic site for large-scale data centres due to its plentiful renewable energy resources and relatively low electricity costs, making it well-suited to the energy-intensive demands of AI workloads. This regional advantage is driving significant technology investments as China continues to scale its AI capabilities nationwide.