Microsoft doubles down in its AI and Cloud infrastructure with a $1.3 billion investment in Mexico

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CEO Satya Nadella highlighted a plan to invest in Mexico over the next three years to build its AI and Cloud infrastructure.

Microsoft invests $1.3 billion in AI and Cloud infrastructure in Mexico
Microsoft invests $1.3 billion in AI and Cloud infrastructure in Mexico (Image credit: Microsoft)

What you need to know

  • Microsoft recently announced its plans to invest $1.3 billion in Mexico to build AI and Cloud technology infrastructure. 
  • The initiative is designed to help enhance the adoption of AI technology across 5 million Mexicans and 30,000 SMBs in three years.
  • Microsoft also plans to address emerging challenges in Mexico, including health, connectivity, and sustainability.  

Microsoft is doubling down on its cloud computing and artificial intelligence investment. Earlier this week, Microsoft CEO Satya Nadella highlighted the company's plan to invest up to $1.3 billion over the next three years to build its infrastructure in Mexico to foster these advances. 

The tech giant plans to use its $1.3 billion investment to enhance broad adoption of AI technology across small and medium-sized businesses (SMBs). Microsoft aspires to reach up to 5 million Mexicans and 30,000 SMBs in three years through the initiative. 

This happens as OpenAI just unveiled OpenAI Academy — the program is designed to make generative AI more accessible to developers across low and middle-income countries with up to $1 million in API credits.

According to Microsoft CEO Satya Nadella:

“We are entering a new era of AI with the promise to create inclusive economic growth and opportunity across every role, industry, and country, including in Mexico. Our investments in AI infrastructure and skilling in Mexico will help ensure people and organizations across the country realize the benefits of this technology shift.”

Microsoft marks 38-years in Mexico with companies like Grupo Bimbo, Tec de Monterrey and Cemex onboard its AI train. With its new initiative, the tech giant hopes to address emerging health concerns, connectivity issues and promote sustainability as part of its broader plans to become a carbon negative, water positive, and zero waste company.

AI seems like a expensive recurrent expenditure for Microsoft

Satya Nadella with Sam Altman at a conference

(Image credit: Bullfrag)

It's apparent that it takes an arm and a leg to keep AI operations running. For instance, OpenAI spends up to $700,000 to keep ChatGPT running. Still, the payoff isn't allowing the AI firm to break even. Reports hitting mainstream media indicate that the ChatGPT maker could be on the brink of bankruptcy, with projections of $5 billion in losses over the next year. 

However, Microsoft, NVIDIA, and Apple will reportedly participate in the firm's latest round of funding to keep its operations afloat, pushing its market cap well beyond $150 billion. Market analysts and experts are confident that OpenAI will become the world's dominant AI company, further citing that it's in a unique consumer and enterprise position. 

Incidentally, Microsoft is having the same issues, with some of its investors raising concerns over its high expenditure on AI projects, citing its difficult to establish a clear path toward profitability in the category. 

Last year, the tech giant partnered with OpenAI and invested $100 billion in a project dubbed Stargate to free themselves from an overdependence on NVIDIA for AI chips. Similarly, the company recently partnered with BlackRock to raise $100 billion to 'emancipate themselves from the shackles' of insufficient power and increase data centers for their ambitious AI dreams.

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Kevin Okemwa
Kevin Okemwa
Contributor

Kevin Okemwa is a seasoned tech journalist based in Nairobi, Kenya with lots of experience covering the latest trends and developments in the industry at Windows Central. With a passion for innovation and a keen eye for detail, he has written for leading publications such as OnMSFT, MakeUseOf, and Windows Report, providing insightful analysis and breaking news on everything revolving around the Microsoft ecosystem. You'll also catch him occasionally contributing at iMore about Apple and AI. While AFK and not busy following the ever-emerging trends in tech, you can find him exploring the world or listening to music.