Microsoft and Amazon Commit Billions to New AI Implementation Units for Businesses

Microsoft is investing $2.5 billion in a new group "assisting clients with AI implementations," reports CNBC: [Microsoft] said Thursday that 6,000 employees will be embedded with clients, in a practice that's become known as forward deployed engineering [or FDE]... The announcement comes two days after cloud rival Amazon said it was putting $1 billion behind an FDE initiative to support fast-paced AI engagements. Leading AI labs Anthropic and OpenAI both established FDE groups in May, partnering with private equity firms, banks and consulting firms. Alongside its technology peers, Microsoft has sunk tens of billions of dollars into building data centers that run generative AI models. Microsoft has also released a variety of AI services, with mixed results. The Microsoft 365 Copilot AI assistant has yet to gain anything approaching ubiquity in the business world, and the GitHub Copilot coding agent has ceded market share to newer players. Microsoft's stock has slumped 21% this year, by far the worst performance among the mega-cap tech companies. One concern on Wall Street is that AI models that quickly compose code might threaten mature software companies... Microsoft has for years provided support and implementation services to customers. The company generated about $2.1 billion in revenue from enterprise and partner services in the March quarter, up 2.5% from a year earlier.

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