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AWS is negotiating a huge deal to supply IBM with Nvidia GPUs via the cloud

Nov 12, 2024 - businessinsider.com
Amazon Web Services (AWS) is reportedly in talks with IBM over a potential $475 million AI cloud deal. The five-year agreement would provide IBM with access to Nvidia GPUs via AWS's cloud service, according to an internal Amazon document. IBM, which already uses AWS services for AI, including training models on EC2 servers with Nvidia chips, would expand its partnership with AWS in the AI space if the deal goes through.

The deal would also boost AWS's AI business, which Amazon CEO Andy Jassy said is growing at "triple digit percentages" annually and is expected to generate "multi-billion dollars" in revenue this year. However, the negotiations could end without a final agreement being signed. It's also unclear if the deal would include access to Amazon's own AI chips, Trainium and Inferentia.

Key takeaways:

  • AWS is in talks with IBM for a potential $475 million deal over 5 years to provide IBM access to Nvidia GPUs through its cloud service.
  • IBM already uses AWS services for AI, including training models on EC2 servers with Nvidia chips.
  • Amazon's AI business is growing at triple digit percentages annually, and is on pace to generate multi-billion dollars in revenue this year.
  • Amazon is set to invest more than $75 billion in capex this year, mostly on cloud infrastructure such as GPUs, networking, and data centers.
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