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AI Agents Take Center Stage, Market Shifts, & Outage Alerts
This Week in Cloud — May 22, 2025
Another week, another torrent of cloud news, with AI continuing its relentless march deeper into every corner of the stack. This past week showcased a distinct pivot towards "agentic AI" across the major hyperscalers, alongside critical updates in governance, security, and a few notable bumps in the road.
⚡ The "Agentic AI" Era Is Here – But Are We Ready?
This week, the buzz around "agentic AI" transformed from theoretical discussions to tangible product launches. AWS introduced Strands Agents, an open-source SDK to build and run AI agents with minimal code, scaling from dev to production and integrating with Amazon Bedrock. Not to be outdone, Google I/O 2025 heavily emphasized agentic experiences with its Gemini API, introducing tools like URL Context for models to pull web content. Microsoft, at Build 2025, unveiled Entra Agent ID to assign unique identities to AI agents, aiming for better security and visibility over these "non-human" users. They also showcased multi-agent orchestration and a "Computer Use" tool allowing agents to automate UI tasks.
This concerted push from all major providers signifies a profound commitment to AI systems capable of autonomous action. However, third-party analysis from The Register raised valid skepticism about the "agentic era," questioning the utility of non-deterministic automation and highlighting interoperability, security, and compliance challenges, especially for regulated industries. While the potential is immense, the industry will need to address these practical hurdles, particularly around control, auditability, and human oversight, for widespread adoption in sensitive environments
🔍 The Rundown
AI Innovations & Modernization: AWS launched Strands Agents, an open-source SDK for building AI agents, signaling a move to foster an open-source ecosystem around agentic AI. They also updated AWS Transform for Mainframe and VMware Workloads, automating legacy system migration with AI integration.
New EC2 GPU Instances: New Amazon EC2 P6-B200 instances, powered by NVIDIA Blackwell GPUs, were introduced to accelerate large-scale AI training and HPC applications, underscoring the intense demand for AI compute and AWS's strategic partnership with NVIDIA.
Governance & Data Sovereignty: Azure introduced significant governance updates at Build 2025, including Azure Service Groups for flexible management and enhanced Azure Policy features. Crucially, the EU Data Boundary, ensuring EU metadata is processed and stored within EU data boundary countries, is now generally available.
AI-Driven Security: Microsoft Purview launched an AI-driven Data Security Investigations (DSI) solution, leveraging AI for proactive identification of complex data security threats, highlighting the escalating "AI arms race" in cybersecurity.
Zero-Day Vulnerabilities: Microsoft's May 2025 security updates addressed 72 vulnerabilities, including five actively exploited zero-days, underscoring the persistent and evolving threat landscape targeting Microsoft platforms and the critical need for timely patching.
AI and Developer Tools: Google I/O 2025 unveiled major AI advancements, including Google AI Studio enhancements with Gemini 2.5 Pro, Agentic Experiences with Gemini API for building intelligent agents, and new ML Kit GenAI APIs (Gemini Nano) for on-device AI
Security Flaw & Outage: A potential privilege escalation flaw in GCP Cloud Functions was identified and patched, highlighting risks from overly permissive configurations. Additionally, Google Compute Engine (GCE) experienced connectivity issues for nearly nine hours on May 19, affecting multiple dependent GCP services.
Strategic AI & Hybrid Cloud Partnerships: OCI deepened partnerships with IBM to bring watsonx AI tools to OCI, and with Red Hat to expand Red Hat Enterprise Linux and OpenShift support on OCI for hybrid cloud transformation. These moves showcase OCI's growing role as a platform for advanced AI workloads and enterprise modernization.
Healthcare AI Focus: Oracle announced a strategic partnership with Cleveland Clinic and G42 to launch an AI-based global healthcare delivery platform. Oracle Health is also bringing its AI technology to Canadian health organizations to reduce physician burnout.
Outage and Security Concern: OCI experienced a six-hour outage in Europe on May 19 affecting its identity platform in the Germany Central region. Separately, a report indicated suspected Russian threat actors leveraged OCI Object Storage to host malicious content, underscoring the challenge for cloud providers to prevent platform misuse.
📈 Trending Now: The ROI of AI—A Growing Scrutiny
While AI adoption is accelerating at a breakneck pace, driven by new tools and capabilities from cloud providers, a significant question looms: What's the return on investment? CloudZero's "The State of AI Costs 2025" report indicates that average monthly AI spending increased by 36% from 2024 to 2025, but only about half (51%) of organizations can actually evaluate the ROI for their AI commitments. This aligns with prior Gartner observations. This disconnect suggests that while the technological imperative to adopt AI is strong, cloud professionals will face increasing pressure to demonstrate tangible business value. Expect to see a growing demand for more sophisticated cost management, performance optimization, and value realization tools from both cloud providers and their partners as enterprises seek to justify their significant AI investments.
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💼 Job Spotlight
 | Deliver Solutions Architect - Data and AI at Databricks $161,300-$247,300 | Remote US Drive the post-sale technical strategy for Databricks’ most complex customers, accelerating enterprise-scale data and AI adoption across the Lakehouse platform. |
 | Solutions Architect at Glean $160,000-$210,000 | New York, NY Architect cutting-edge AI systems as the technical lead for Glean’s most strategic customers. |
👋 Until Next Week
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