Vice President of Microsoft Brad Smith and Chancellor Olaf Scholz at the Microsoft office in Berlin. Picture Alliance
Microsoft’s Vice Chairman Brad Smith announced on Wednesday an investment of 3.3 billion euros in German AI infrastructure.
When asked by Business Insider, Smith emphasizes that European consumers will have a variety of choices in the AI market in the future, including Chinese companies such as Huawei, Alibaba and Baidu.
Smith explains that he is ready to go into a “head-to-head race,” including against Chinese competitors.
In the wake of Microsoft’s announcement of billions in investments in Germany, Vice Chairman Brad Smith spoke about the increasing competition from Chinese companies in the areas of artificial intelligence (AI) and cloud computing. In response to a request from Business Insider during a press conference in Berlin, Smith shared his impressions and assessments of the global technology landscape and the “competition” that is based not only on American giants, but increasingly also on Chinese players.
“I was in China at the end of 2023 and noticed a growing export orientation, particularly in the automotive sector, where production of electric vehicles has increased significantly,” explains Smith. He highlights that Chinese automakers are clearly targeting the European market, a level of ambition that Smith says can also be seen in the hyperscale computing space.
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According to the CEO, there will be a variety of choices for European consumers in the AI market in the future. “In Europe, the focus is initially on large American companies such as AWS, Microsoft, Google, IBM and Oracle,” says Smith. “But Huawei, Alibaba, Baidu and others are just as relevant.” According to Smith, in addition to the global giants, local technology providers, especially in Germany, will also play a role.
When asked about the threat posed by Chinese competitors, Smith replies: “I’m not here to talk about whether anyone poses a threat.” However, he is ready to “go head-to-head” in the AI market. Head race.” “I rely on our track record, our commitments and our processes to maintain trust to compete.â€
According to Analysis of Visualcapitalist and Global X ETFs The Chinese AI market is estimated to be around 30 trillion yuan (US$3.9 trillion) by 2035, with a current value of around 150 billion RMB (21.5 billion euros) and a forecast value of 400 billion RMB (57.5 billion euros) by 2025. In comparison, the German AI market is also significant, with Germany hosting 245 AI startups and receiving private investments of 6.5 billion euros from 2013 to 2022.
With a view to future investments in Germany, Microsoft wants to play a leading role in the expansion of the AI infrastructure. Microsoft will invest almost 3.3 billion euros in Germany over the next two years to massively expand its data center capacity for applications in the field of artificial intelligence (AI) and cloud computing. According to dpa information, the investment funds will flow primarily to North Rhine-Westphalia, where Microsoft wants to set up a new cloud region.
“Our job is to continue to raise the standards among ourselves. And we have to win that competition, as well as the fundamental technology features that people rightly care about,” Smith said.
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