Microsoft expects to spend $80 billion on AI this year
SAN FRANCISCO, January 4, 2025 (BSS/AFP) – Microsoft President Brad Smith said Friday that the company plans to spend about $80 billion on artificial intelligence (AI) this year.
Smith argued in an online post that AI is poised to transform every aspect of life and that it is imperative that the United States become a world leader in this technology.
“In many ways, artificial intelligence is the driving force of our time, and the next four years can lay the foundation for America’s economic success over the next quarter century,” Smith said.
“The United States is poised to be at the forefront of this new technology wave, especially if we can build on our strengths and partner effectively internationally.”
Smith called on President-elect Donald Trump and Congress to expand support for AI innovation through initiatives such as increasing research funding for universities and the National Science Foundation.
Smith said China and the United States are competing to spread their AI systems to other countries with the aim of becoming the de facto standard.
“Given the nature of the technology market and its potential network effects, this competition between the United States and China for international influence is likely to be won by the earliest movers,” Smith reasoned.
“Therefore, the United States needs a smart international strategy to rapidly support U.S. AI around the world.”
Smith said China has begun offering developing countries subsidized access to scarce computer chips and helping them build local AI data centers.
“The Chinese have wisely recognized that once a country standardizes on a Chinese AI platform, it will likely continue to rely on that platform in the future,” Smith said.
He recommended that the United States move quickly to promote its own AI technology as better and more reliable, and involve allies in the effort.
Microsoft is on pace to invest about $80 billion this year to build out AI data centers, train AI models and deploy cloud-based applications, Smith said.
Microsoft’s fiscal year 2025 ends at the end of June.
Microsoft’s rivals Amazon, Google and OpenAI are also spending billions of dollars on AI, although it remains unclear when and how they expect to see a return on those investments.
