Meta runs out of money, has to call on Microsoft, Amazon to contribute capital

Meta CEO Mark Zuckerberg. Photo: Reuters .

Meta is actively seeking help from tech giants like Microsoft and Amazon, The Information reported, hoping to have partners shoulder the training costs for its Llama language model.

The source also said that this move by Facebook's father reflects the company's deep concern about the increasing cost of AI development.

To attract financial support, Meta has offered a range of incentives, including inviting investors to participate in developing Llama features. It is unclear whether these proposals will go forward.

When Meta first proposed the idea of ​​the “Llama Alliance,” the company didn’t get the enthusiastic response it had hoped for, according to sources. Some companies were resistant to helping Meta train an open-source model, citing the fact that Llama was free to use and that funding was unlikely to yield any profit.

Additionally, in terms of business model, Meta’s profit structure is quite simple. While Microsoft and Google charge users for using AI chatbots, Meta’s business is almost entirely dependent on advertising.

Meanwhile, AI development costs continue to rise. In 2024, Meta's operating cash flow will reach $91.3 billion , of which $39 billion will be for capital expenditures, and $35 billion will be for stock buybacks and dividends. In 2025, the company expects capital expenditures to increase by 60%, reaching $60-$65 billion .

That would account for about a third of parent company Facebook's projected revenue this year, according to S&P Global Market Intelligence analysts.

Source: https://znews.vn/meta-can-tien-phai-keu-goi-microsoft-amazon-gop-von-post1547916.html