The artificial intelligence dilemma facing Microsoft and Google: It takes a lot of money to become profitable

Tech giants such as Microsoft and Alphabet say they will continue to invest more deeply in the field of artificial intelligence, which is expected to reap huge returns in the future, although the benefits may take some time to appear

Microsoft said that building new data centers to support artificial intelligence services will lead to a significant increase in costs, because purchasing chips from companies such as Nvidia for use in data centers will further increase capital expenditures

According to analysts, Microsoft is in Costs in the field of artificial intelligence mainly include two aspects: on the one hand, investment in the development of own products, such as the soon-to-be-released Copilot AI assistant at $30 per month; on the other hand, investment in artificial intelligence products that want to use Microsoft Azure cloud computing services Enterprise support

Microsoft executives expect the service to start generating major revenue in the first half of next year

, according to Ben Barga, CEO and principal analyst at Creative Strategies market research firm Lin (Ben Bajarin) revealed that they are purchasing large quantities of Nvidia's flagship chip H100, which is mainly used for artificial intelligence applications. Bajarin further pointed out that whether it is this quarter or next quarter, you are likely to See a similar story with Amazon, as both companies are the cloud computing platforms currently used by most people in the market to train artificial intelligence systems

Although time is limited, Alphabet has done an excellent job of controlling costs . According to Alphabet CFO Ruth Porat, who will serve as president and chief investment officer, the reason for lower-than-expected capital expenditures in the second quarter was due to delays in data center construction

Third Bridge Global Technology Media and Telecommunications Industry leader Scott Kessler pointed out that although Google has invested more than $200 billion in artificial intelligence over the past decade, its investment has not been fully recognized by users and investors.

According to Analysts point out that Google has an advantage because it has its own custom chip, the Tensor Processing Unit (TPU), which can be used to handle artificial intelligence tasks and reduce costs.

Microsoft may buy Nvidia chips in large quantities because it doesn't have its own replacement chips, this is the view of Atlantic Securities analyst James Caldwell

Although Google admitted that it will continue to buy chips from other companies, Porat said Deepwater Asset Management's managing partner, Gene Munster, stated that both Microsoft and Google are aligned on the inflection point, but Microsoft's investors are looking for more.

The above is the detailed content of The artificial intelligence dilemma facing Microsoft and Google: It takes a lot of money to become profitable. For more information, please follow other related articles on the PHP Chinese website!