Amazon follows IBM and Microsoft, shuts China AI lab that generated nearly $1 billion in sales

Amazon is shutting down its artificial intelligence (AI) lab in Shanghai, making it the latest US tech company to scale back research in China, a report has said, citing growing geopolitical tensions as the reason. The move follows similar actions by IBM and Microsoft, which have also reduced their R&D efforts in the country as US scrutiny over China-related AI work intensifies.According to a report by The Financial Times, the development was confirmed by Wang Minjie, a scientist at the lab, via a social media post on WeChat. The lab was established by Amazon Web Services (AWS) in 2018 and Wang stated that his team was being “dissolved due to strategic adjustments amid US-China tensions,” and reflected on the “golden era of foreign research labs” in China.Wang also noted that his team had published over 100 academic papers and developed a neural network framework that generated nearly $1 billion in sales for Amazon.Notably, the exact number of employees at the Shanghai lab is unknown, but Amazon reported having over 10,000 employees in China in 2022, with AWS employing more than 1,000 staff at its peak.

Job cuts at Amazon and US control over AI infrastructure

This decision comes as part of a broader trend of global job cuts at Amazon. Last month, CEO Andy Jassy warned employees that AI adoption would lead to a reduction in staff. An Amazon spokesperson, Brad Glasser, confirmed the recent job cuts at AWS, calling them “difficult business decisions” necessary to “invest, hire, and optimise resources.”“We’ve made the difficult business decision to eliminate some roles across particular teams in AWS. These decisions are necessary as we continue to invest, hire, and optimise resources,” Glasser said.IBM cut over 1,000 R&D jobs in China last year, while Microsoft offered to relocate hundreds of Chinese employees working on AI and cloud.