Amazon is playing the long game with A.I.
Despite Bill Gates saying that models like ChatGPT will spell the end for Amazon and Google as we know them, Amazon seems determined to win the generative artificial intelligence race slowly but surely.
Unlike its Big Tech rival Google—which reportedly declared a 'Code Red' over the launch of OpenAI's large language model—Amazon Web Service's CEO outlined the first move in a longer-term strategy, beginning with an $100 million investment.
The funds will be spent on building a center which will specialize in helping businesses use generative A.I.
Although a large sum, $100 million is a fraction of what Amazon's cloud unit could have pledged.
As the online giant's fastest-growing and most profitable segment—generating $80 billion in 2022—the web services arm could have cranked open its war chest to try to catch up with, or pass, competitors like Google, Microsoft and Meta.
But AWS CEO Adam Selipsky said this week that companies are merely "three steps" into a 10 kilometer race when it comes to generative A.I., hinting at a far longer strategy.
“You ask yourself the question—where are the different runners three steps into a 10K race?” Selipsky said to CNBC. “Does it really matter? The point is, you’re three steps in, and it’s a 10K race.”
The business is already working with the likes of RyanAir and Lonely Planet, Amazon told CNBC, adding that the center is a program as opposed to a physical location.
Brushing off concerns about the billions being invested by other Big Tech, Seplinsky went back to Amazon's basic principle: Being "customer obsessed."
A mentality coined early on by Amazon founder Jeff Bezos, Seplinsky said he'll use customers as his guiding light in the A.I. upheaval: “Amazon has had many examples in its history where it said, we’re going to focus on customers and have steadfast belief that we’re going to work with customers, we’re going to build what they want.
“And if people want to perceive us in a certain way, we’re misunderstood, that’s OK, as long as customers understand where we’re going.”
Amazon CEO Andy Jassy has alluded to A.I.'s place in the company's future, saying it will be a "big deal" for the business across multiple services, including for consumers, sellers, brands, and creators, adding that the technology would “transform and improve virtually every customer experience.”
Flashier entrances
Seplinksy said he wasn't concerned that Amazon doesn't own the first popular large language model, or have a finger in the pie with the likes of OpenAI.
That's not the case for Microsoft and Google, which have scrambled to lead the pack on the revolutionary technology.
Microsoft has long been a backer of Sam Altman's OpenAI, reportedly having invested $13 billion into the San Francisco-based firm since 2019.
The business has also doubled-down on its own commitments to the technology, with executives mentioning the phrase "artificial intelligence" 50 times during its Q1 earnings call earlier this year.
The focus sent Microsoft's share price flying—boosting the fortune of co-founder Bill Gates by $2 billion in the days following the call.
Meanwhile, Big Tech competitors have poured billions into their initiatives to get them off the ground as soon as possible.
Despite Google's CEO Sundar Pichai denying The New York Times report that he made a 'Code Red' call on the publication's 'Hard Fork' podcast, the business has pulled out the stops to get its A.I. services to market, including launching chatbot Bard.
At Meta, Facebook founder Mark Zuckerberg appears to have abandoned his adventures in the Metaverse for the time being with insiders revealing the CEO is now spending the majority of his time on artificial intelligence endeavors.
