Andy Jassy, Amazon’s CEO, identified the tech as the company’s next big focus in his annual letter to shareholders, writes Business Insider’s Ana Altchek.

Jassy described gen AI as Amazon’s “next set of primitives,” which is corporate jargon for saying Amazon wants companies getting into gen AI to build stuff using their tools.

It’s a strategy that’s worked well for Amazon in the past. AWS, Amazon’s public cloud business that Jassy helped create, has been incredibly profitable and upended how companies think about their tech strategy.

But there’s a new kid on the block. The AI cloud includes Nvidia’s GPUs and large-language models, which power the AI services and tools that are all the rage now. Meanwhile, the cloud 1.0 business, which AWS has long dominated, is no longer cool.

Jassy’s letter details how Amazon plans to reposition itself at the forefront of this new era.

The three-layer approach includes Amazon powering companies that build and train models (Anthropic, Snap), helping companies use these models with their data (Bridgewater Associates, Pfizer), and creating customer-facing AI applications themselves.