• After the recent announcement of a USD 1.5 billion investment, G42 will utilize Microsoft’s Azure cloud platform to enhance its AI development initiatives.
  • Microsoft and G42 will create a USD 1 billion developer fund to develop AI skills in the UAE and beyond and plan to collaborate on data center projects in emerging markets.

Recently, Microsoft Corp. has invested USD 1.5 billion in G42, an artificial intelligence developer based in the UAE.

As part of the deal, the cloud computing and software giant will acquire a minority stake in G42. Furthermore, Microsoft Vice Chair and President Brad Smith will join G42’s board.

The Financial Times reported that the investment “required negotiations” with the Biden administration. As a condition of the deal, G42 reportedly agreed to eliminate Huawei Technologies Co. Ltd. hardware from its artificial intelligence infrastructure. In a separate report, Bloomberg stated that last year, G42 reached an agreement with the U.S. Commerce Department to reduce its operations in China.

Group 42 Holding Ltd., known as G42, was established in Abu Dhabi around six years ago. Last August, it open-sourced Jais, a large language model featuring 13 billion parameters capable of processing both Arabic and English text. This model is built on the Transformer neural network architecture, which forms the basis of most sophisticated large language models.

After the announcement of a USD 1.5 billion investment recently, G42 will leverage Microsoft’s Azure cloud platform to advance its AI development initiatives. The company intends to transition its “data platform and other critical technology infrastructure” to Azure. Additionally, G42 plans to utilize the cloud platform to offer AI software to its customers, building on last year’s partnership with Microsoft to host its Jais language model on Azure.

The partnership between the companies also spans several other domains. Microsoft and G42 will jointly create a USD 1 billion developer fund aimed at enhancing AI capabilities in the UAE and other regions. Additionally, the companies intend to collaborate on a data center infrastructure project in emerging markets in the future.

Microsoft Chief Commercial Officer Judson Althoff noted in a blog post recently, “By bringing expanded low latency datacenter infrastructure to emerging markets, Microsoft and G42 will help accelerate digital transformation across key industries in those regions. This will provide countries across the Middle East, Central Asia and Africa with expanded access to services and technologies that will allow them to address the most challenging business concerns while ensuring the highest standards of security and privacy.”

The agreement enhances Microsoft’s substantial role in the AI startup ecosystem. The company is the main supporter of OpenAI, providing the ChatGPT-4 developer with over USD 10 billion in cloud infrastructure and capital in recent years. Most of the employees of LLM developer Inflection AI Inc., one of OpenAI’s most well-funded competitors, were hired by Microsoft more recently.

The tech giant’s strategy for AI investment encompasses not only startups specializing in large language models but also its Azure platform. Last November, Microsoft revealed plans to install an internally-designed machine learning accelerator, known as Maia 100, across its cloud data centers. As part of this initiative, the company is also implementing a custom liquid cooling system to manage the heat produced by the new AI chips.