AWS plans to significantly strengthen its support for startups that use cloud infrastructure in response to increasing competition, particularly from Microsoft, in the field of AI services.
according to CNBCAWS is doubling the value of the credits offered to certain startups through the Activate program. Starting this July, startups that have recently secured Series A funding will be eligible to receive an increased credit of $200,000, up from the previous $100,000. Seed-stage startups will still be eligible for the $100,000. The revised $200,000 credit also benefits from an extension of its expiration date, previously set at one year, to three years.
New Leadership
AWS recently underwent a leadership change, bringing in former sales and marketing chief Matt Gurman as CEO, in line with the company’s strategic alliances with Silicon Valley startup founders. Gurman has made it clear that AWS wants to work closely with startups, noting that AI companies in particular are ideal customers for the cloud platform, according to people familiar with the interactions.
AWS dominates the cloud infrastructure sector, with revenues expected to reach $25 billion in the first quarter of 2023, up 17% year over year. The company claims it supports more than 280,000 startups and that 96% of AI and machine learning “unicorns” use its services.
Nevertheless, the cloud computing landscape is changing rapidly. Google Cloud and Microsoft Azure are accelerating progress, especially by leveraging advances in AI. Microsoft has made great strides, especially since its partnership with OpenAI introduced ChatGPT, and since the end of 2022, a number of AI-driven projects have flowed into Azure.
In the face of growing competition, Amazon has stepped up its investments in AI, pouring billions of dollars into OpenAI rival Anthropic. Additionally, AWS is expanding its support for AI-driven startups, launching a 10-week Generative AI Accelerator program that offers participants up to $1 million in cloud credits.
This increased competition is reflected in the changes in market share: AWS has maintained its leadership, but its market share has declined slightly from 32% to 31% over the three years. In contrast, Azure has grown significantly from 19% to 25%, and Google Cloud has expanded its market share as well.
Expanding AI capabilities
Amazon’s competitive landscape extends beyond cloud infrastructure. As part of its strategic expansion into AI, the company hired Adept co-founder and CEO David Ruan and several colleagues. The move, coupled with its licensing of Adept’s agent technology and multimodal models, underscores Amazon’s commitment to improving its AI capabilities.
Increased competition among cloud providers has resulted in better terms and support for startups. For example, Microsoft’s offerings include $350,000 in Azure credits for startups participating in accelerators such as Y Combinator and AI Grant, and up to $150,000 in credits over four years through its Founders Hub program for startups that haven’t previously been venture-backed.
As the cloud and AI sector continues to grow, bold steps like these from giants like Amazon, Microsoft, and Google will be key in defining the evolution of the tech and startup ecosystems, meaning that with more support and resources, the next generation of AI and cloud-based technologies can be developed at a faster pace within large tech companies.
(Photo: Marques Thomas)
Read also: AWS expands into Asia Pacific with new infrastructure region in Taiwan
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