The e-commerce giant plans to invest heavily in data centers over the next 15 years. The sum is colossal: 150 billion dollars. The goal ? Strengthen its position as a giant in the cloud services market. According to Synergy Research Group estimates, Amazon had a 31% share of the cloud infrastructure market in the fourth quarter of 2023, up from 33% a year earlier. A slight decline which resulted in the increase in Microsoft's market share, reaching a record level of 24% in the fourth quarter of 2023, or 1% more than the same period a year ago.
With Google Cloud Services' 11% market share, the “Big Three” represented two-thirds of the global cloud market. The rest of the competition, including Alibaba Cloud, Salesforce, IBM Cloud, Oracle and Tencent Cloud, remains stuck in the low single-digit range, with market shares between 2% and 4%. Amazon therefore does not intend to rest on its laurels, proof of which is this gargantuan and, to say the least, aggressive investment.
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A globe full of data centers
“We are significantly increasing our capacity,” said Kevin Miller, vice president of Amazon Web Services (AWS), Amazon's cloud computing subsidiary used by more than 1.45 million businesses, according to an internal report. He also indicated to Bloomberg that the firm wanted to get closer to customers. And this involves the construction of data centers across the globe, particularly in Mississippi, Saudi Arabia, Malaysia and Thailand. These plans were first mooted two years ago when another massive $148 billion investment was announced.
The funds will also be used to expand existing sites. Today, according to certain sites mapping Amazon's data centers, the latter owns between 165 And 180 distributed throughout the world. The Washington, Virginia metropolitan area as well as rural Oregon, which offers cheap hydroelectric power and attractive tax breaks, stand to benefit greatly from these investments, reported Bloomberg.
Managing the explosion in demand for AI applications
By comparison, the investments made by its closest competitors Microsoft and Google represent a drop in the ocean. In 2023, Microsoft has certainly increased its spending on data centers by more than 50% and decided to invest an additional $13 billion in OpenAI last January, with the intention of gradually integrating the large GPT language model -4 of the AI startup in each of its products, including Azure. However, the amounts are far from competing with those that Amazon can advance.
The firm is also more cautious in this matter. She decided to bet on another horse: Anthropic. This week, it finalized the investment of $4 billion announced in September 2023 and defined as follows: $1.25 billion initially followed by $2.75 billion released later, on March 28. Beyond this financing, Amazon makes a certain number of its services available to the start-up. This includes using AWS as the primary cloud provider for mission-critical workloads, including security research and the development of future foundation models.
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Anthropic, which recently presented its latest family of large language models called Claude 3, is also considered a serious competitor to OpenAI. Its models rival the biggest. Opus, considered the most powerful, thus surpasses OpenAI's GPT-4 and equals Gemini 1.0 Ultra in the areas of reasoning, mathematics and coding.
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