70% Of Generative AI Startups Rely On Google Cloud, AI Capabilities

Alphabet’s Q2 2023 earnings call highlighted the growing adoption of generative AI across the company’s cloud and product offerings.

CEO Sundar Pichai emphasized how over 70% of generative AI startups rely on Google’s cloud infrastructure and AI capabilities. This shows the traction for next-gen technology among emerging companies looking to build new services powered by Google Bard and other models.

“Our AI-optimized infrastructure is a leading platform for training and serving generative AI models. More than 70% of gen AI unicorns are Google Cloud customers, including Cohere, Jasper, Typeface, and many more,” he said.

Google Cloud is also providing startups access to resources like its Vertex AI platform, advanced TPU chips, and a library of over 80 pre-trained AI models to accelerate development.

The cloud division itself continues to see strong growth, with revenue up 28% to $8 billion in Q2. It turned an operating profit of $395 million, compared to a $590 million loss a year ago. Cloud became profitable in Q1.

Google is also incorporating generative AI across its own products. Pichai discussed how models like PaLM and the upcoming Gemini are making services like Search and productivity tools in Workspace more helpful.

For example, the new Search Generative Experience uses AI to provide more natural and conversational results. The technology can connect concepts together to help users research complex topics and make decisions.

On the ads side, generative AI is enhancing creatives, optimization, and campaign management for Google’s millions of advertising customers. Features like automated asset creation and optimizations driven by AI can improve return on ad spend.

Other Google products like Bard conversational AI and Duet in Workspace are seeing strong adoption as well. The company is prioritizing the development of its most promising AI applications through focused resourcing.

“Our new generative AI offerings are expanding our total addressable market and winning new customers,” he said.