Microsoft Invests $1.5 Billion Into AI Firm in the UAE

Microsoft invested $1.5 billion into G42, an artificial intelligence (AI) company based in the United Arab Emirates (UAE). This was disclosed on April 16 as part of the Microsoft AI investment plans to expand and strengthen its position in the AI industry.

Microsoft AI Investment Opens Innovation Gateways in The Middle East

Microsoft announced its latest investment in AI via an official press release. The investment builds on a partnership between the two companies while granting Microsoft a minority stake in G42. Additionally, Microsoft Vice Chair and President Brad Smith will join the G42 Board of Directors.

.@Microsoft‘s investment in @G42ai will enhance the UAE’s position as a leading #AI hub and provide digital infrastructure and services to help underserved nations innovate and grow. We will combine world-class technology with world-leading standards for safe, trusted, and…

— Brad Smith (@BradSmi) April 16, 2024

In return, G42 will utilize Microsoft’s Azure cloud computing platform to power its AI services and applications to improve the safety and security of its infrastructure.

The collaboration will also extend advanced AI and digital infrastructure to countries in the Middle East, Central Asia, and Africa to ensure access to services for governmental and business needs while upholding the highest standards of security and privacy.

According to Smith, the new partnership is part of a joint effort to bring the AI industry and digital infrastructure to “underserved nations.”

G42 Chairman H.H. Sheikh Tahnoon bin Zayed Al Nahyan also expressed excitement and noted the potential growth of the new collaboration.

“Microsoft’s investment in G42 marks a pivotal moment in our company’s journey of growth and innovation, signifying a strategic alignment of vision and execution between the two organizations,” he explained. “This partnership is a testament to the shared values and aspirations for progress, fostering greater cooperation and synergy globally.”

In addition, Microsoft disclosed that the partnership will support the development of a skilled and diverse AI workforce, with a $1 billion investment in a development fund for developers, driving innovation and competitiveness in the UAE and the broader region.

This partnership is coming a few months after UAE President Sheikh Mohamed bin Zayed Al Nahyan formed an AI council to promote research and investments in AI in the country.

The inclusion of the “US and UAE governments,” as stated in the press release, however, has elicited comments from AI communities and experts, as it comes after months of scrutiny on G42 for its alleged link to China.

On January 9, House Rep. Mike Gallagher, chairman of the U.S. Select Committee on the Chinese Communist Party, addressed a letter to Gina Raimondo, the Secretary of the Commerce Department, to closely examine G42 for potential inclusion on a trade export blacklist.

Gallagher’s concerns stemmed from allegations that G42 maintains relationships with blacklisted Chinese firms, such as Huawei, and collaborates with China’s military and intelligence services. But, G42 has refuted the claim.

Insights into Microsoft AI Investment

Microsoft’s recent collaboration with G42 is part of a series of multi-billion-dollar investments in the AI industry worldwide.

Microsoft AI CEO Mustafa Suleyman announced on April 9 a long-term investment to hire innovators in the U.K.

The company also pledged €3.2 billion ($3.44 billion) at an event in Berlin to boost AI infrastructure in Germany over the next two years.

Shortly after, Microsoft revealed its plan to invest $2.1 billion in AI infrastructure development in Spain to enhance local capacity for the technology.

I’m thrilled to announce that we will expand our AI and cloud infrastructure in Spain by $2.1B USD in the next two years. Our investment is beyond just building data centers, it’s a testament to our 37-year commitment to Spain, its security, and development and digital… https://t.co/arJnZzyDpc

— Brad Smith (@BradSmi) February 19, 2024

The U.K.’s Competition and Markets Authority (CMA) has raised concerns about the development of the AI industry and how partnerships within the sector could potentially stifle competition.

The CMA highlighted the dominant presence of tech giants like Google, Amazon, Microsoft, Meta, and Apple across various aspects of the AI chain, including computing, data, and model development.

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