Microsoft is making significant investments in cloud computing infrastructure to meet the growing demand for AI-powered services.
The company has reportedly agreed to spend billions of dollars over several years on startup CoreWeave, which provides easy access to Nvidia’s powerful GPUs to run AI models. Microsoft’s investment in CoreWeave is aimed at ensuring that OpenAI’s viral ChatGPT chatbot has enough computing power.
OpenAI relies on Microsoft’s Azure cloud infrastructure for its computational needs. The deal with CoreWeave comes as a response to growing demand for Microsoft’s infrastructure, as the company looks for additional ways to tap into Nvidia’s GPUs.
CoreWeave, which recently raised $200 million in funding, has grown substantially in revenue and is valued at $2 billion. The startup’s funding includes investments from hedge fund Magnetar Capital and Nvidia. CoreWeave delivers computing power at a significantly lower cost than traditional cloud providers and offers a variety of Nvidia GPUs, including the A100 for AI and high-performance computing and the A40 for visual computing.
Demand for generative AI has grown since OpenAI introduced its ChatGPT chatbot, prompting companies like Google to integrate generative AI into their products. Microsoft is also developing chatbots for its services such as Bing and Windows. To meet this demand, Microsoft needs additional access to Nvidia’s GPUs, and the deal with CoreWeave ensures a steady supply.
Nvidia’s stock price has seen a significant rise this year, driven by demand for generative AI and large language models in data centers. CoreWeave’s computing power, which is 80% less expensive than legacy cloud providers, is an attractive option for clients who struggle to get enough GPU power from major cloud providers. CoreWeave’s ability to provide cost-effective computing power has contributed to its success in the market.
Microsoft’s investment in CoreWeave is part of the company’s broader strategy to stay at the forefront of the AI boom. By gaining access to CoreWeave’s GPU infrastructure, Microsoft can continue to provide the computational resources necessary for OpenAI’s AI models, including ChatGPT.
As the AI industry continues to grow rapidly, Microsoft’s investments in AI infrastructure and partnerships with startups like CoreWeave demonstrate the company’s commitment to meet the growing demand for AI-powered services.
