Meta Platforms is reportedly developing plans to establish a cloud infrastructure business. This new venture aims to sell access to its AI computing power and models to external customers. The move will position Meta in direct competition with established cloud service providers such as Amazon Web Services, Microsoft Azure, and Google Cloud.
This initiative comes as Meta has made significant investments in securing data centers and other infrastructure to support its own artificial intelligence ambitions. The cloud business is intended to generate revenue from the company's excess computing capacity, according to sources familiar with the matter who wished to remain anonymous.
The announcement has eased some pressure on Meta's stock, which has seen underperformance compared to the S&P 500 this year. Analysts suggest this strategy could help Meta capitalize on the growing demand for AI services and reduce its reliance on its advertising market. However, it also raises questions about Meta's ongoing efforts to catch up with leading AI labs. Meta is projected to spend as much as $145 billion on AI infrastructure this year.
The planned cloud service would allow developers to access AI models hosted on Meta's infrastructure, including its Muse Spark model, and pay for the necessary computing power, similar to Amazon Web Services' Bedrock. Meta is also considering selling raw AI computing capacity, potentially impacting neocloud companies like CoreWeave and Nebius, which could see reduced spending from Meta.
Mark Zuckerberg, Meta's CEO, had previously indicated that entering cloud computing was "definitely on the table" during a May shareholder meeting, noting frequent inquiries from firms interested in purchasing access to Meta's AI models or spare computing power.
