AI inference providers adopt AWS-style software stack strategy

The author argues that AI inference providers and neoclouds facing commodity pricing pressures can succeed by following the AWS playbook: using cheap raw compute to acquire customers and then climbing the software stack with higher-value products like fine-tuning, reinforcement learning, and custom model serving. While starting at the bottom of the stack yields thin margins, these providers earn direct relationships that make them sticky and difficult to leave. However, the author notes that climbing today is harder than it was for AWS due to entrenched competitors and aggressive hyperscalers. Open article →