Compared to Microsoft and Alphabet-C, does Amazon have more potential in AI competitions?

Will Amazon lead Microsoft and Alphabet in the AI arms race?

Amazon is the latest tech giant to join the AI arms race with its cloud-based platform Bedrock, which will help customers build generative AI apps such as chatbots, image and text generators, and custom search engines.

It's worth noting that Amazon won't be building and providing its own exclusive AI models. Instead, the company's Amazon Web Services (AWS) platform will offer generative AI models from third-party providers such as Stability AI, Anthropic, and AI21 Labs.

Bedrock will also offer Amazon's in-house AI platform called Titan, which can generate text based on user input (similar to OpenAI's ChatGPT) and convert the text input into numerical format.

This approach is different from the one followed by companies like Alphabet and Microsoft, and it could bring huge returns to Amazon.

Amazon's AI strategy is a smart move

Microsoft and OpenAI are pushing the development of generative AI and deploying the technology into more applications such as Bing search engine and Microsoft 365 productivity and collaboration tools.

The software giant has also launched a cloud service that helps businesses integrate OpenAI's algorithms into their own services and build custom applications according to their needs.

On the other hand, Bard made a mistake when showcasing a chatbot at Alphabet, causing a sharp drop in Alphabet's stock price. However, Alphabet is currently working to improve Bard, although it is still in the pilot phase and is only being tested in the US and UK before being widely promoted.

Compared to Microsoft and Alphabet, Amazon may seem late to the game, but that's not the case. With Bedrock, Amazon can not only access its proprietary large language model (LLM) Titan, but also the aforementioned third-party platforms.

This could make Amazon the preferred platform for companies that want to use LLM and build apps according to their needs.

Bedrock is gaining traction

Amazon CEO Andy Jassy said several companies want to use LLM, but the significant investment and time required to train these models have become barriers to entry.

Jassy noted that Bedrock provides a set of foundational models for companies that want to develop generative AI applications, ideally helping to reduce the cost and time of developing such applications. Amazon has not yet revealed the pricing for Bedrock, but it appears that the platform has already witnessed early demand from some well-known enterprises.

Swami Sivasubramanian, Vice President of Data and Machine Learning at AWS, wrote in a blog post: "Accenture, Deloitte, Infosys, and Slalom are building practices to help enterprises use generative AI faster. Independent software vendors like C3.ai and Pegasystems are pleased to be able to easily access their curated FM with Bedrock, as well as all the security, privacy, and reliability they expect from AWS."

Greater Potential?

It's not surprising to see more and more companies flocking to Bedrock, as the service offers multiple generative AI models on one platform.

Moreover, if Amazon adds more LLM vendors to Bedrock, it could become a one-stop-shop for generative AI apps.

According to Grand View Research, the annual growth rate of the AI market is expected to reach 35% by 2030, with annual revenue reaching $110 billion by the end of the forecast period.

Therefore, in the long run, Amazon's foray into generative AI could provide a huge boost to its growth, giving investors another reason to buy this tech stock that already has some significant catalysts.