PYMNTS MonitorEdge May 2024

Amazon Gives $230 Million in AWS Credits to AI Startups

AWS

Amazon is reportedly investing $230 million in Amazon Web Services (AWS) credits in AI startups.

As Reuters reported Wednesday (June 13), these credits will give early-stage generative artificial intelligence (AI) firms free access to computing power, a variety of AI models, and infrastructure, provided they build their companies using AWS.

According to the report, Amazon says it already offers $1 billion in cloud credits every year to startups, with this new commitment focusing on supporting generative AI startups.

“They’ll be able to iterate very quickly and pivot very quickly as necessary,” Matt Wood, vice president of AI Products at AWS, told Reuters. “Then ultimately, when they hit on that home run, they’ll be able to double down and get to the scale with security, responsibility and consistency.”

The credits will also help 80 early-stage startups complete the AWS Generative AI Accelerator program, the company said, with startups eligible for up to $1 million in AWS credits.

Amazon in April expanded its cloud credits to cover the use of AI models from companies like Anthropic, Meta, Mistral AI and Cohere.

“This is another gift that we’re making back to the startup ecosystem, in exchange for what we hope is startups continue to choose AWS as their first stop,” Howard Wright, vice president and global head of startups at AWS, said at the time.

Demand for AI has fueled a corresponding demand for cloud services, and that’s been good news for Amazon.

Last month, the company reported earnings that showed sales at AWS jumping 17% year over year to $25 billion, while the division’s operating income climbed to $9.4 billion, up from $5.1 billion during the same quarter last year.

Amazon President and CEO Andy Jassy attributed the comeback to companies renewing their infrastructure modernization efforts and the growing appeal of AWS’ AI capabilities.

The tech giant has plans to introduce new AWS infrastructure regions in the Kingdom of Saudi Arabia and Mexico, along with a $10 billion investment to build a pair of data center complexes in Mississippi, further expanding its global footprint.

And as the Reuters report notes, investments in AI startups have also sparked antitrust concerns among regulators.

Last week saw reports that the U.S. Justice Department and Federal Trade Commission (FTC) had reached an agreement that lets them proceed with investigations into the dominant roles OpenAIMicrosoft and Nvidia command in the AI field.

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