Tech giants aggressively chase forward deployed engineers

Like the breakout star in a blockbuster movie, forward-deployed engineers (FDEs) are gaining traction within the tech industry.

Hyperscalers like Amazon and Microsoft are standing up teams of FDEs to help clients effectively implement AI solutions. Earlier this month, Microsoft debuted Microsoft Frontier Company, a division it claims will deploy 6,000 “industry and engineering experts” to assist companies in building and iterating AI systems. Microsoft said it would invest $2.5 billion in this new entity.

Microsoft’s announcement came shortly after Amazon Web Services (AWS) shared that it would roll out a dedicated FDE organization, backed by a $1 billion investment.

Join the club. Jaclyn Rice Nelson, CEO and co-founder of Tribe AI, told IT Brew the hyperscalers’ sudden affinity for FDE businesses is driven by enterprises still struggling to implement and adopt AI solutions on their own.

“There’s a gap between what the technology can do and what enterprises can do, and the value they can get out of it, and that is a really big problem if you are a model provider or a hyperscaler,” Rice Nelson said. “And so these FDE arms, these separate companies, are built to go accelerate and close the gap for their customers, and therefore drive adoption for their products.”

What to make of the FDE frenzy. Rice Nelson said it wasn’t surprising to see Microsoft and Amazon form FDE units, adding that much of the industry is likely scrambling to mimic the AI giants, which were first movers in debuting standalone FDE businesses. In May, Anthropic launched a joint AI services venture, dubbed Ode, to help mid-size companies integrate Claude into their operations; that same month, OpenAI announced the OpenAI Deployment Company, its AI consulting arm.

“I would expect that we see Google making a similar move very soon,” Rice Nelson said. “No one’s going to be left out, and I think that is sort of the nature of activity happening.”

Harshil Parikh, VP of products at Checkmarx, said the new FDE practices are a “win-win situation” for tech giants and their customers.

“If I’m a large customer, I can do things that were not possible before by pairing humans or FDEs with intelligence layers,” Parikh said. “And if I’m a hyperscaler, I’m building a flywheel so my services can be consumed more and more for more things.”

However, Jennifer Hamel, research VP of enterprise data and AI services at IDC, said the launch of the two FDE divisions may signal that the traditional partners model is “no longer sufficient” to address the skills gap threatening organizations’ AI deployments. (Both AWS and Microsoft said in their announcements that partner relationships will remain strong.)

“I will be interested to see how that impacts the services partner ecosystem because it does seem to be taking some opportunities away that their partners may have served in the past,” Hamel said.

Rising competition? With the emergence of devoted FDE units from some of the largest tech giants, some professionals predict smaller companies might have a more challenging time finding FDEs for their own businesses.

“Smaller companies have had a harder time hiring AI skills anyway, and this certainly doesn’t make that any easier,” Hamel said.

However, others believe the newly formed units will ultimately spark interest in the career path, leading to more FDEs in the industry. “More people will realize that this is a lucrative career,” Parikh said. “So, I think we will have more supply, or people will consider switching from whatever traditional roles they might have into becoming FDEs.”