Amazon’s Potential Arm IPO Investment: 5 Things To Know From AI To AWS

Tighter Arm-AWS Partnership Could Be An AI Game-Changer: Partner

Innovative Solutions is a fast-growing solution provider that signed a strategic collaboration agreement with AWS in 2023, while also recently launching a new generative AI product in July dubbed Tailwinds on the AWS Marketplace.

The Rochester, N.Y.-based cloud provider believes Amazon has the ability to make a game-changing move in the AI industry if a deeper partnership with Arm is born.

Travis Rehl, senior vice president of product and services at Innovative, said AWS and Arm forming a tighter partnership could prove to be similar to how Apple is leveraging its partnership with chip manufacturer Taiwan Semiconductor Manufacturing (TSCM), which makes nearly all of Apple’s custom chips.

“Apple pours billions into [TSCM’s] R&D business. In return, they get access to the latest and greatest chips before everybody else for their phones and for their devices. Yeah, Apple’s paying a little premium, but they stay well ahead of the competition as a result,” said Rehl. “And it’s like a one-year lag time for anybody else to get the same level of compute optimization or compute power.”

Rehl said it takes an enormous amount of computational power to build and scale AI.

“There’s a race right now to find the best chip that can optimize that process so you can bring the best models to market the fastest,” he said. “Amazon is making a bet and saying, ‘If I get the best chips from the best vendor, and I make it homegrown native-AWS, it means our customers can go 2x-3x-4x faster than everybody else. And it’d be a no-brainer to go with Amazon for the cost effectiveness and go-to-market speed compared to Microsoft.”

The Takeaway: Arm CPUs tightly integrated with Amazon’s ever-growing AI portfolio could be the market differentiation that powers AWS’ massive push to become the dominant AI cloud leader.