Microsoft is expanding its artificial intelligence empire abroad

San Francisco (awp/afp) – Microsoft, which reports its quarterly results on Thursday, has announced nearly $10 billion (9.2 billion Swiss francs at current rates) in investments in artificial intelligence (AI) abroad in recent months, the price that must be paid to remain one of the most important players in this crucial market, according to experts.

The success of ChatGPT from the start-up OpenAI has brought generative AI to the forefront, but also Microsoft, OpenAI’s main backer.

Since then, the Windows manufacturer and its competitor Google have been competing with each other using tools to produce text, images or lines of code in everyday language upon simple request.

Meta and Amazon followed suit, with increasingly sophisticated models (the underlying technology) and AI assistants for consumers and businesses.

Everyone is investing massively. These billions of dollars are “the investment” needed to “become part of the elite,” says Jeremy Goldman, an analyst at Emarketer.

These four major companies are “vying for a seat in the AI ​​oligopoly. They have a war chest and believe they have to spend this money on AI or they will be penniless,” he explains.

“AI has become so valuable that they can’t afford to lose.”

Generative AI is considered a new industrial revolution, raising all kinds of grand hopes and apocalyptic concerns.

‘Unrealistic’ to hope to dominate

But in the near future, it represents a potential windfall for the cloud giants (Amazon, Microsoft and Google) thanks to its applications in terms of productivity for their customer companies.

This activity should earn Microsoft an additional $25 to $30 billion a year by 2025, Dan Ives estimates.

“It is a turning point for Microsoft, as the iPhone was for Apple,” assures the Wedbush Securities expert: “the adoption of generative AI and Copilot (Microsoft’s AI assistant, editor’s note) will accelerate, and Azure (the cloud service) will win more contracts.”

Since February, the US group has unveiled investments in AI of $3.4 billion in Germany, $2.1 billion in Spain and $2.9 billion in Japan, over two years.

Satya Nadella’s group plans to build new capable data centers, help train millions of people in AI, and finance the energy infrastructure needed to supply the facilities.

“Microsoft uses external partners, while Google relies more on its internal teams,” notes Jeremy Goldman.

Investments abroad are attracting attention because they are substantial, but also “because they involve AI, which dominates the technological news,” he underlines.

Ultimately, the big players all spend so much money, “that it would be unrealistic to say they hope to dominate.”

“Paris”

Microsoft also contracts with companies outside its ally OpenAI, which has already received about $13 billion from the Windows developer in recent years.

Under a multi-year agreement signed last February, French AI start-up Mistral will benefit from an investment of 15 million euros.

Most importantly, Microsoft will invest $1.5 billion in G42, an AI company from the United Arab Emirates, and sit on its board of directors.

An operation encouraged by the United States, with the G42 committed to abandoning Chinese partnerships in favor of American technology, according to the New York Times and Bloomberg.

“At first we thought the AI ​​wars would be fought by a few players looking for general AI that could do anything and everything. Now the market is starting to recognize that different models will be needed if necessary. explains Jeremy Goldman.

In fact, cloud companies are now emphasizing the diversity of their offerings in this area.

Microsoft has just presented Phi-3 Mini, the first in a new series of small models, adapted to simple tasks, which can be performed, for example, on a smartphone.

Microsoft’s approach to AI is ‘taking bets’, says Jeremy Goldman. The group is investing in several strategies, some of which are likely to pay off more.”

afp/fr