Amazon needs traders to comprehend it received’t be left behind within the newest Huge Tech arms race over synthetic intelligence.

In a letter to shareholders Thursday, Amazon

(AMZN) CEO Andy Jassy stated the corporate is “investing closely” in giant language fashions (LLMs) and generative AI, the identical know-how that underpins ChatGPT and different related AI chatbots.

“We have now been engaged on our personal LLMs for some time now, consider it’ll remodel and enhance just about each buyer expertise, and can proceed to take a position considerably in these fashions throughout all of our shopper, vendor, model, and creator experiences,” Jassy wrote in his letter to shareholders.

The remarks, which have been a part of Jassy’s second annual letter to shareholder since taking on as CEO, trace on the stress that many tech firms really feel to clarify how they’ll faucet into the quickly evolving market for AI merchandise. Since ChatGPT was launched to the general public in late November, Google

(GOOG), Fb

(FB) and Microsoft

(MSFT) have all talked up their rising concentrate on generative AI know-how, which may create compelling essays, tales and visuals in response to person prompts.

Amazon’s objective, in line with Jassy, is to supply less expensive machine studying chips in order that “small and huge firms can afford to coach and run their LLMs in manufacturing.” Massive language fashions are skilled on huge troves of information in an effort to generate responses to person prompts.

“Most firms wish to use these giant language fashions, however the actually good ones take billions of {dollars} to coach and a few years, most firms don’t wish to undergo that,” Jassy stated in an interview with CNBC on Thursday morning.

“What they wish to do is that they wish to work off of a foundational mannequin that’s huge and nice already, after which have the flexibility to customise it for their very own functions,” Jassy informed CNBC.

With that in thoughts, Amazon on Thursday unveiled a brand new service known as Bedrock. It primarily makes basis fashions (giant fashions which are pre-trained on huge quantities of information) from AI21 Labs, Anthropic, Stability AI and Amazon accessible to shoppers through an API, Amazon stated in a weblog publish.

Jassy informed CNBC he thinks Bedrock “will change the sport for folks.”

In his letter to shareholders, Jassy additionally touted AWS’s CodeWhisperer, one other AI-powered device which he stated “revolutionizes developer productiveness by producing code ideas in actual time.”

“I might write a complete letter on LLMs and Generative AI as I believe they are going to be that transformative, however I’ll go away that for a future letter,” Jassy wrote. “Let’s simply say that LLMs and Generative AI are going to be a giant deal for purchasers, our shareholders, and Amazon.”

Within the letter, Jassy additionally mirrored on main Amazon by means of “one of many tougher macroeconomic years in latest reminiscence,” because the e-commerce big reduce some 27,000 jobs as a part of a significant bid to rein in prices in latest months.

“There have been an uncommon variety of simultaneous challenges this previous 12 months,” Jassy stated within the letter, earlier than outlining steps Amazon took to rethink sure free transport choices, abandon a few of its bodily retailer ideas and considerably scale back general headcount.

Amazon disclosed in a securities submitting Thursday that Jassy’s pay bundle final 12 months was valued at some $1.3 million, and that the CEO didn’t obtain any new inventory awards in 2022. (When Jassy took over as CEO in 2021, he was awarded a pay bundle largely comprised of inventory awards that valued his complete compensation bundle at some $212 million.)

Regardless of the challenges at Amazon, nevertheless, Jassy stated in his letter that he finds himself “optimistic and energized by what lies forward.” Jassy added: “I strongly consider that our greatest days are in entrance of us.”