Microsoft to invest $1.7bn in AI, cloud infrastructure in Indonesia

JAKARTA, INDONESIA: Microsoft will invest $1.7 billion over the next four years in new cloud and artificial intelligence infrastructure in Indonesia — marking the single largest investment in Microsoft's 29-year history in the country —  Microsoft CEO Satya Nadella said on Tuesday.

Microsoft operates one of the world's largest cloud computing operations and has made significant strides into artificial intelligence by integrating an AI chatbot into its search engine, Bing. Its earnings report on Thursday revealed a 20% profit increase for the January-March quarter as it seeks to position itself as a leader in applying artificial intelligence technology to enhance workplace productivity.

"This new generation of AI is reshaping how people live and work everywhere, including in Indonesia," Nadella said, in Jakarta on the first stop of a tour of Southeast Asia.

"The investments we are announcing today — encompassing digital infrastructure, skilling, and support for developers — will help Indonesia thrive in this new era," he added.

Microsoft views Southeast Asia as a growing market and a potential location for further AI product development. The rise of AI in the region is expected to significantly impact its economic landscape. A study conducted by Kearney, a global consulting firm, suggested that AI could contribute nearly $1 trillion to Southeast Asia's GDP by 2030, with Indonesia expected to capture $366 billion.

The investment announced on Tuesday will include AI training for 840,000 individuals, as well as support for Indonesia's burgeoning community of tech developers.

Indonesia is home to the third-largest developer community in the Asia-Pacific region, following India and China. More than 3.1 million developers in Indonesia use GitHub, a platform for software development, collaboration, and innovation owned by Microsoft. It is projected to be among the top five developer communities on GitHub globally by 2026.

Apple CEO Tim Cook met with Widodo on April 17 and stated that the company would "consider" manufacturing in Indonesia.

Under President Joko Widodo's administration, Indonesia has emphasised the development of digital technology and information sectors, aiming to achieve the government's Golden Indonesia 2045 Vision. This vision projects Indonesia becoming one of the world's top five economies with a GDP of up to $9 trillion, exactly a century after it gained independence from Dutch colonisers.

Nadella met with Widodo on Tuesday at the Presidential Palace. During the meeting, Widodo proposed the establishment of an AI research centre in Indonesia, and a Microsoft data centre based in Bali or Nusantara, the country's new capital city on Borneo island, according to Indonesia's Minister of Communication and Information Technology, Budi Arie Setiadi.

The CEO's regional visit began in Indonesia and will be followed by stops in Thailand and Malaysia over the next two days.

By RSS/AP