Picking Teams in AI: Cloud Platforms' Strategic Partnerships with LLM Providers

Major cloud infrastructure providers (Microsoft, Snowflake, Databricks, Google, Oracle, Amazon) are forming strategic partnerships with LLM companies to establish competitive positions in the AI infrastructure layer. This consolidation changes the decision calculus for startups selecting cloud providers, as data security, model access, and customer segmentation now compete with traditional factors like credits and catalog breadth. The rapid commoditization of AI algorithms suggests that proprietary model advantages will erode over time, making platform partnerships more about ecosystem positioning than technological differentiation.