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Amazon (AMZN) Expands Cloud Credits for Startups Using AI Models

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Amazon’s (AMZN - Free Report) cloud-computing platform, Amazon Web Services (“AWS”), continues to make strong efforts to bolster its footprint in the booing generative AI market.

This is evident from the latest expansion of its free credits offering to startups for using AI models from other providers like Anthropic, Meta, Mistral AI and Cohere, which are available on Amazon Bedrock.

Notably, Bedrock has provided Amazon with a breakthrough in the generative AI space. Amazon Bedrock offers seamless access to high-performing foundation models from AI companies through an API.

AWS strives to encourage startups to leverage advanced AI models to power their businesses on the back of its latest move.

Reportedly, Amazon has offered $6 billion in credits to startups in the past decade. Currently, it is offering $500,000 in credits to the new cohort that was launched in January 2024 in partnership with Y Combinator.

Offering free credits is expected to drive AWS’s momentum among startups, as well as boost the adoption rate of Amazon Bedrock. This, in turn, will strengthen AWS’s customer base, which will contribute well to AWS revenue growth., Inc. Price and Consensus, Inc. Price and Consensus, Inc. price-consensus-chart |, Inc. Quote

Amazon’s Growing Generative AI Efforts

The latest move bodes well for AWS’s growing generative AI efforts.

Recently, it announced a partnership with a South Korea-based AI startup called Upstage, as part of which the latter launched its small language model called SOLAR MINI on AWS.

SOLAR MINI is capable of performing various language tasks in Korean and English. The tasks include understanding, summarizing, translating and predicting new content.

In addition, AWS recently extended its collaboration with NVIDIA (NVDA - Free Report) to power its portfolio with generative AI technology.

The NVIDIA Blackwell GPU platform, which was introduced at GTC 2024, will be available on AWS. This will help speed up inference workloads for resource-intensive, multi-trillion-parameter language models.

AWS strives to enable customers to explore new generative AI capabilities by delivering secured and advanced infrastructure, software and services. In this regard, AWS will offer NVIDIA GB200 Grace Blackwell Superchip and B100 Tensor Core GPUs. AWS also intends to provide Amazon Elastic Compute Cloud instances, backed by NVIDIA Grace Blackwell GPU.

AWS added a new capability to Amazon CodeWhisperer, which is designed to offer generative AI-powered customized code suggestions by leveraging an organization's internal codebase.

Growing generative AI efforts are expected to aid Amazon in capitalizing on the immense growth prospects in the generative AI market.

Per an Allied Market Research report, the global generative AI market’s value is likely to hit $191.8 billion by 2032, witnessing a CAGR of 34.1% between 2023 and 2032.

Rising Competition

The Zacks Rank #3 (Hold) company’s solidifying prospects in this promising market are expected to continue providing a competitive advantage over its peers like Microsoft (MSFT - Free Report) and Alphabet’s (GOOGL - Free Report) Google, which are also gaining steam.

You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Microsoft is continuously riding on strong momentum across its Intelligent Cloud business, driven by the solid adoption of Azure. Strength in Azure AI remains a positive. The company’s strong efforts to power its cloud capabilities with generative AI are noteworthy. Similar to AWS, Microsoft Azure offers credits to attract AI startups to use OpenAI’s models.

Meanwhile, Google Cloud, which contributes substantial growth to Alphabet's total revenues, is gaining from the growing generative AI capabilities, increasing data centers, availability zones and cloud regions. Google Cloud also offers cloud credits, which can be applied for more than 130 models on Vertex AI.

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