Microsoft expands AI infrastructure with Lumen Technologies partnership

Strategic collaboration helps technology giant to stay ahead in AI race against major competitors

NEW YORK:

Microsoft is set to expand its AI infrastructure capabilities by leveraging network equipment from Lumen Technologies, a move announced by both companies on Wednesday.

The partnership aims to address the current limitations Microsoft faces due to a shortage of data centre infrastructure, which has been a significant hurdle in deploying AI models effectively.

In April, Microsoft reported that these infrastructural deficits were slowing its progress in harnessing the AI technology boom. To combat this, Microsoft has been actively investing in enhancing its cloud capabilities, notably through significant financial commitments to cloud infrastructure. These investments are part of Microsoft's strategy to stay ahead in the AI race, particularly against major competitors like Alphabet (Google's parent company) and Amazon.com.

Microsoft has gained an early advantage in AI through its strategic partnership with OpenAI, the creators of ChatGPT, emphasising its commitment to leading in AI development and application. The collaboration with Lumen not only expands Microsoft's capacity to handle AI workloads but also assists Lumen in reducing operational costs.

By adopting Microsoft’s Azure cloud services, Lumen anticipates an improvement in its cash flow, projecting savings of over $20 million in the next 12 months. This financial boost is crucial for Lumen as it continues efforts to turn around its fortunes following a debt restructuring in March. As of the end of the first quarter, Lumen reported long-term debt totalling $18.59 billion.

This partnership is a testament to Microsoft's ongoing evolution in AI technology. Over the past few years, Microsoft has pushed the boundaries of AI applications, continually integrating advanced AI capabilities into its products and services. By enhancing its infrastructure, Microsoft not only supports its growth in cloud-based services but also ensures it remains at the forefront of the AI development space, ready to meet the increasing demands of modern AI applications and services.