Hitachi and Microsoft Announce Billion-Dollar AI Partnership
Microsoft and Hitachi have announced a multibillion-dollar partnership to speed up the adoption of generative AI. This is the latest partnership and investment that the two companies are making together.
A joint statement from the two companies says that as part of the three-year partnership, the Japanese conglomerate will add Microsoft products like Microsoft Cloud and GitHub Copilot to Lumada, which is Hitachi’s main digital, software, and services business.
At the start of this fiscal year in April, Hitachi wants to make $18.9 billion from its Lumada business. During the last fiscal year, the company made $15 billion in sales. Hitachi and Google announced a partnership at the end of last month. As part of the deal, Hitachi would set up a business unit to help businesses use Google’s AI technology to solve problems in their fields.
On the other hand, Microsoft wants to put billions of dollars into Asia, especially Southeast Asia, which has over 670 million people and is growing quickly. This is a place where demand for data centers and cloud computing businesses is growing. The U.S. tech giant said last month that it would invest $2.2 billion in cloud and AI infrastructure in Malaysia. This came after it said the same thing in Thailand and Indonesia.
Hitachi also wants to use GitHub Copilot and Azure OpenAI Service to teach more than 50,000 generative AI professionals how to make advanced software. Additionally, Hitachi will make its customer service better with Azure OpenAI Service. Chief Executive Officer of Hitachi, Keiji Kojima, said that the company will spend 300 billion yen ($1.92 billion) on generative AI in fiscal 2024 to take advantage of new growth opportunities. Also, Kojima said that the two companies have been working on a number of different projects, such as making digital solutions for the manufacturing and logistics sectors.
As the need for AI computing grows, Microsoft’s Azure cloud computing business has been growing quickly. Azure’s cloud business grew 31% last quarter compared to the same time last year. Its AI services drove 7% of that growth and helped the company’s overall 17% growth in sales.
