Generative AI’s Implications for Cloud Computing

Generative AI’s potential to create value continues to take shape as the technology is beginning to be utilized to help transition other corporations on to their cloud services. This increased adoption will help re-accelerate the growth of cloud divisions like Amazon’s AWS.

Applications like ChatGPT have caused a surge in interest and investment in both their developers and in the components related to their development, evident in Nvidia’s stock price. At market close this Friday, the company’s share price sat at $661.57, which is a near 213.72% increase compared to the year to date value at $210.89 per share. This meteoric rise can be attributed to the company’s production of top-of-the-line graphics processing units, a necessary component in the expedited training of many generative AI models.

One of the main choke-points for the conversion of in-house software to cloud products sold by companies like Amazon is the investment necessary for an attractive ROI. A recent report by McKinsey posits that generative AI, when used for application remediation and migration, allows for up to a 40% decrease in time and investment necessary for these transitions. 

As generative AI services continue to develop, we may see sales from cloud computing divisions at companies like Google, Microsoft, and Amazon gain momentum, not only as a result of their generative AI products but also through the use of these technologies to transition in-house software systems.