SAN FRANCISCO: AWS and Microsoft want to embed thousands of their own engineers at client companies to help them capitalize on artificial intelligence, which has yet to prove its profitability in the business world.
Microsoft announced Thursday the creation of a unit called Microsoft Frontier Company, which is backed by a $2.5 billion investment and brings together 6,000 experts and engineers.
The new Microsoft entity comes as rival AWS, the world's leading cloud provider, announced Tuesday a similar $1 billion investment in an organization called Forward Deployed Engineering, also tasked with dispatching thousands of engineers to help clients.
The two cloud giants are responding to the same challenge: companies are buying more AI tools, but those investments are not yet paying off in obvious ways.
As of the end of 2025, almost nine out of 10 companies had deployed AI in at least one business function, but 94 percent reported no significant benefit from those expenditures, according to consultancy McKinsey.
Its study, published in late April, argued that handing out AI tools to employees is not enough -- companies need to rethink the very way they work.
Microsoft and AWS, both of which supply servers and software to a myriad of businesses worldwide, are betting that their engineers will deliver results faster and better than clients' in-house teams.
"The currency that the customers are always talking about right now is speed," said Francessca Vasquez, vice president of Frontier AI Engineering and Services at AWS.
With these initiatives, Microsoft and AWS are following the lead of San Francisco's major AI labs.
OpenAI, the creator of ChatGPT, and its rival Anthropic, maker of Claude, dispatched their own teams of engineers among client sites this spring, partnering with major investment funds.
In doing so, the AI labs revived an idea pioneered more than a decade ago by Palantir, the US data analytics specialist.
The push comes as tech giants seek to recoup record investments to develop AI and build massive data centers.
Despite strong growth in its cloud business, Microsoft has disappointed markets and its shares have shed nearly a quarter of their value since January.
The company cut roughly 15,000 jobs in 2025 and a further wave of cuts is expected.
Microsoft has not specified at this stage whether its new cohort of experts will be made up of new hires or internal redeployments.
