AI’s role in computing cycle and IT environment
Earlier in the series, we discussed the partnership between Microsoft (MSFT) and Amazon.com (AMZN), which highlights growing influence of AI (artificial intelligence) in the IT (information technology) environment.
To date, Microsoft has made 18 acquisitions in the AI space. The company has allocated approximately 8,000 employees to focus in this space after announcing a reorganization in 2016. LinkedIn’s strategic acquisition provided Microsoft with access to large data sets, which are essential to the development of AI.
Morgan Stanley (MS) views data as the “holy grail” of AI. AI and ML (machine learning) are the next big technologies in the IT environment that are expected to drive the expected $2 trillion in spending during the next new computing cycle. Notably, AI is considered one of six “Innovation Accelerators.” This explains Microsoft and other tech players’ growing interest in AI space.
IBM has the maximum patents in AI space
Microsoft, Amazon, and Google are not the only companies trying to get a slice of the AI pie. IBM (IBM) has invested billions of dollars in machine learning and AI through partnerships and acquisitions to develop its Watson platform. IBM had the most AI patents among peers in 2016.
The above presentation by shows that among its technology peers, Microsoft (MSFT), Qualcomm (QCOM), Google (GOOG), Samsung (SSNLF), and SAP (SAP), IBM was the leader with ~1,050 patents in AI in 2016.
According to Morgan Stanley, Microsoft, Amazon, and IBM (IBM) are early but “underappreciated” leaders in the AI space, with market shares between 20%–30%. This explains Microsoft’s increased interest in this rapidly growing space.