Amazon Cloud invests $100 million to launch a generative AI innovation center, competing against Microsoft and Alphabet-C.

The generative artificial intelligence (AI) competition sparked by ChatGPT is in full swing, and Amazon is catching up.

On Thursday, June 22, Eastern Time, Amazon announced that its cloud business, Amazon Web Services (AWS), has launched a new project called the "Amazon Generative AI Innovation Center," investing $100 million and currently collaborating with two customers, Highspot and Twilio.

Amazon said that the above-mentioned center is named as such, but it is not a physical entity in the real world, but rather a project. It will connect Amazon's affiliated data scientists, strategists, engineers, and solution designers with customers and partners to help enterprise customers use generative AI technology to accelerate their innovation and success.

Sri Elaprolu, Amazon's senior data science manager and head of the AI Innovation Center, revealed that the $100 million investment will specifically fund "personnel, technology, and processes" related to generative AI and will support collaboration with Amazon customers to help them conceive, design, and launch new generative AI products and services.

Elaprolu said that Amazon's AI Innovation Center will initially prioritize working with customers who have previously proposed generative AI plans, goals, or aid requests to Amazon. The center will also prioritize organizations in the financial services, healthcare and life sciences, media and entertainment, automotive and manufacturing, energy and utilities, and telecommunications industries.

Some media outlets have pointed out that Amazon has $64 billion in cash and $5 trillion in annual revenue, making the $100 million investment a drop in the bucket. However, this investment shows that Amazon recognizes the current importance of generative AI and responds to competitors Microsoft and Alphabet-C.

Amazon CEO Adam Selipsky likened the competition to a 10,000-meter race. He believes that in a 10,000-meter race, it is not important that different runners take different first three steps, but that the runners take three steps and it is a 10,000-meter race.

Selipsky believes that AI will be the next wave of innovation in the cloud field, and it will drive customers to use the cloud more because they need the cloud to achieve generative AI. In providing generative AI, Amazon provides a standard of trustworthiness that other competitors cannot match. He said:

"I can't tell you how many Fortune 500 companies I've talked to that have banned ChatGPT. Because at least its initial versions didn't have the concept of enterprise security."

Regarding the current chip shortage in AI applications, Selipsky said that there is a global shortage of computing power for generative AI and machine learning in the short term, but the situation will improve in the coming months. In addition, Selipsky expects that due to economic uncertainty, some customers will slow down their spending on the cloud. He said that many customers have basically completed cost optimization, while some are still in the middle of this process. It is difficult to predict when this trend will end, and we are still in a dilemma.