Amazon Web Services (AMZN) is preparing to update its Bedrock AI cloud service in order to make it easier for customers to build AI apps called agents, according to The Information. Indeed, AWS will improve Bedrock’s runtime so that it can run more AI models, including those from other cloud providers. Right now, Bedrock limits which models and tools customers can use, while competitors like Google (GOOGL) and Microsoft (MSFT) give customers more flexibility. Many businesses want to run apps on AWS but still use models from OpenAI or Google, which is currently difficult because it requires managing multiple cloud systems.
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As a result, AWS is racing to improve Bedrock because agents use more computing power than chatbots and can generate more revenue for cloud companies. In fact, Microsoft and Google’s cloud businesses are growing faster than AWS, which is partly due to their AI services. Interestingly, AWS already earns billions from its partnership with AI firm Anthropic, but it has faced problems as some customers have had to bypass AWS to access Anthropic’s models directly. Therefore, AWS leaders are worried about losing more customers to other clouds if they don’t make Bedrock more flexible.
Whether AWS will let customers manage OpenAI models through Bedrock remains uncertain, since OpenAI models like GPT-4o run exclusively on Microsoft’s cloud. In the meantime, many AWS customers turn to startups like CrewAI and Hugging Face to build agents, though they currently must run them on AWS servers they manage themselves. After the update, these tools will be supported on fully managed Bedrock infrastructure.
Is Amazon Stock Expected to Rise?
Turning to Wall Street, analysts have a Strong Buy consensus rating on AMZN stock based on 46 Buys and one Hold assigned in the past three months, as indicated by the graphic below. Furthermore, the average AMZN price target of $241.64 per share implies 13.6% upside potential.
