Amazon will double the value of credits it offers some startups to use its cloud infrastructure, CNBC has learned, as the company faces heightened competition from Microsoft in artificial intelligence services.
Starting July 1, startups that have raised a Series A round of funding in the past year will be eligible for $200,000 in credits through AWS’ Activate program, up from $100,000 before, the Amazon cloud unit said in an email to venture capitalists this week. Seed-stage startups will still be eligible for $100,000 in credits, AWS said.
Two people briefed on the changes confirmed the credit increase, though they asked not to be named because the information is private.
Matt Garman, who was recently promoted to CEO of AWS after running sales and marketing, was meeting with founders in Silicon Valley this week, the people said. Garman told the execs that collaborating with startups would always be a primary focus, one of the people said, adding that Garman described AI companies as AWS’ ideal customers.
An AWS spokesperson confirmed the increase in credits and Garman’s visit to Silicon Valley. The spokesperson added that in the past, the $100,000 would expire in one year, while the $200,000 credit will now expire in three years.
Amazon, which is best known for its massive online retail operation, derives most of its profit from AWS, a business it launched in 2006, well before rivals Microsoft and Google hit the scene. AWS leads the market, with $25 billion in revenue in the first quarter, up 17% from a year earlier.
But Microsoft Azure and Google Cloud are growing more quickly, and are benefiting from rapidly advancing AI models. Backed by Microsoft, OpenAI launched ChatGPT in late 2022 on Azure, and has since attracted a wave of AI workloads to Microsoft from companies big and small. Google has a number of large language models, most notably Gemini.
Amazon has been trying to catch up in generative AI and has poured billions of dollars into OpenAI challenger Anthropic.
Last month, AWS CEO Adam Selipsky announced his resignation after three years running the business, with Garman named as his successor. During Selipsky’s time at the helm, Microsoft and Google increased their share of the cloud infrastructure market. One analyst told CNBC that Microsoft “ran laps around” AWS in generative AI.
Startups have long been fertile ground for cloud infrastructure companies, as they try and lure ambitious founders who could be building the next multibillion-dollar business.
In November, Microsoft announced a partnership with Silicon Valley accelerator Y Combinator that would provide participating startups with $350,000 in Azure credits and access to graphics processing units (GPUs) for training AI models, a spokesperson said. Microsoft has since extended the $350,000 credit incentive to other accelerators, including the AI Grant.
Startups enrolled in Microsoft’s Founders Hub program, which doesn’t require previous venture funding, can receive up to $150,000 in Azure credits over four years.
In addition to its Activate offering, Amazon has a new 10-week generative AI accelerator program. Participants will be able to access up to $1 million in cloud credits, according to the website.
Earlier on Friday, Amazon’s head scientist, Rohit Prasad, told employees that the company has hired David Luan, co-founder and CEO of AI startup Adept, along with some of Luan’s colleagues. “Amazon is also licensing Adept’s agent technology, family of state-of-the-art multimodal models, and a few datasets,” Adept said in a blog post.
Amazon logo on a brick building exterior, San Francisco, California, August 20, 2024.
Smith Collection | Gado | Archive Photos | Getty Images
Amazon representatives met with the House China committee in recent months to discuss lawmaker concerns over the company’s partnership with TikTok, CNBC confirmed.
A spokesperson for the House Select Committee on the Chinese Communist Party confirmed the meeting, which centered on a shopping deal between Amazon and TikTok announced in August. The agreement allows users of TikTok, owned by China’s ByteDance, to link their account with Amazon and make purchases from the site without leaving TikTok.
“The Select Committee conveyed to Amazon that it is dangerous and unwise for Amazon to partner with TikTok given the grave national security threat the app poses,” the spokesperson said. The parties met in September, according to Bloomberg, which first reported the news.
Representatives from Amazon and TikTok did not immediately respond to CNBC’s request for comment.
TikTok’s future viability in the U.S. is uncertain. In April, President Joe Biden signed a law that requires ByteDance to sell TikTok by Jan. 19. If TikTok fails to cut ties with its parent company, app stores and internet hosting services would be prohibited from offering the app.
President-elect Donald Trump could rescue TikTok from a potential U.S. ban. He promised on the campaign trail that he would “save” TikTok, and said in a March interview with CNBC’s “Squawk Box” that “there’s a lot of good and there’s a lot of bad” with the app.
In his first administration, Trump had tried to implement a TikTok ban. He changed his stance around the time he met with billionaire Jeff Yass. The Republican megadonor’s trading firm, Susquehanna International Group, owns a 15% stake in ByteDance, while Yass has a 7% stake in the company, NBC and CNBC reported in March.
— CNBC’s Jonathan Vanian contributed to this report.
A worker delivers Amazon packages in San Francisco on Oct. 24, 2024.
David Paul Morris | Bloomberg | Getty Images
Amazon on Thursday announced Prime members can access new fixed pricing for treatment of conditions like erectile dysfunction and men’s hair loss, its latest effort to compete with other direct-to-consumer marketplaces such as Hims & Hers Health and Ro.
Shares of Hims & Hers fell as much as 17% on Thursday, on pace for its worst day.
Amazon said in a blog post that Prime members can see the cost of a telehealth visit and their desired treatment before they decide to proceed with care for five common issues. Patients can access treatment for anti-aging skin care starting at $10 a month; motion sickness for $2 per use; erectile dysfunction at $19 a month; eyelash growth at $43 a month, and men’s hair loss for $16 a month by using Amazon’s savings benefit Prime Rx at checkout.
Amazon acquired primary care provider One Medical for roughly $3.9 billion in July 2022, and Thursday’s announcement builds on its existing pay-per-visit telehealth offering. Video visits through the service cost $49, and messaging visits cost $29 where available. Users can get treatment for more than 30 common conditions, including sinus infection and pink eye.
Medications filled through Amazon Pharmacy are eligible for discounted pricing and will be delivered to patients’ doors in standard Amazon packaging. Prime members will pay for the consultation and medication, but there are no additional fees, the blog post said.
Amazon has been trying to break into the lucrative health-care sector for years. The company launched its own online pharmacy in 2020 following its acquisition of PillPack in 2018. Amazon introduced, and later shuttered, a telehealth service called Amazon Care, as well as a line of health and wellness devices.
The company has also discontinued a secretive effort to develop an at-home fertility tracker, CNBC reported Wednesday.
Former U.S. Army intelligence analyst Chelsea Manning says censorship is still “a dominant threat,” advocating for a more decentralized internet to help better protect individuals online.
Her comments come amid ongoing tension linked to online safety rules, with some tech executives recently seeking to push back over content moderation concerns.
Speaking to CNBC’s Karen Tso at the Web Summit tech conference in Lisbon, Portugal, on Wednesday, Manning said that one way to ensure online privacy could be “decentralized identification,” which gives individuals the ability to control their own data.
“Censorship is a dominant threat. I think that it is a question of who’s doing the censoring, and what the purpose is — and also censorship in the 21st century is more about whether or not you’re boosted through like an algorithm, and how the fine-tuning of that seems to work,” Manning said.
“I think that social media and the monopolies of social media have sort of gotten us used to the fact that certain things that drive engagement will be attractive,” she added.
“One of the ways that we can sort of countervail that is to go back to the more decentralized and distribute the internet of the early ’90s, but make that available to more people.”
Nym Technologies Chief Security Officer Chelsea Manning at a press conference held with Nym Technologies CEO Harry Halpin in the Media Village to present NymVPN during the second day of Web Summit on November 13, 2024 in Lisbon, Portugal.
Asked how tech companies could make money in such a scenario, Manning said there would have to be “a better social contract” put in place to determine how information is shared and accessed.
“One of the things about distributed or decentralized identification is that through encryption you’re able to sort of check the box yourself, instead of having to depend on the company to provide you with a check box or an accept here, you’re making that decision from a technical perspective,” Manning said.
‘No longer secrecy versus transparency’
Manning, who works as a security consultant at Nym Technologies, a company that specializes in online privacy and security, was convicted of espionage and other charges at a court-martial in 2013 for leaking a trove of secret military files to online media publisher WikiLeaks.
She was sentenced to 35 years in prison, but was later released in 2017, when former U.S. President Barack Obama commuted her sentence.
Asked to what extent the environment has changed for whistleblowers today, Manning said, “We’re at an interesting time because information is everywhere. We have more information than ever.”
She added, “Countries and governments no longer seem to invest the same amount of time and effort in hiding information and keeping secrets. What countries seem to be doing now is they seem to be spending more time and energy spreading misinformation and disinformation.”
Manning said the challenge for whistleblowers now is to sort through the information to understand what is verifiable and authentic.
“It’s no longer secrecy versus transparency,” she added.