Summary Bullets:

• Snowflake showed off generative AI (GenAI) enhancements to its platform including enabling workloads to be run natively without data egress and a range of partner LLMs offered directly on the platform.

• While Snowflake has been aggressive in adding tools and features to support GenAI, it remains in many ways a closed ecosystem competing against larger rivals for the fast-growing market.

At the Data Cloud World Tour Sydney, held this August, Snowflake laid out updates and enhancements to its cloud-based data management and analytics platform. Further, it demonstrated its momentum in the Asia-Pacific region, bringing together local customers and partners to showcase its capabilities and efforts in Australia and the wider region. Snowflake’s core proposition remains providing a cloud-based “single source of truth” for data across an enterprise. By migrating all data and related workflows onto the platform Snowflake aims to eliminate silos, reduce costs related to data transfer and copying, and improve security and governance by creating one perimeter. This remains the core value proposition for the platform, as the company continues to expand capabilities and services beyond its roots in data warehousing, to offer a greater range of related data and analytics services. The event was used to showcase updates made to the platform in the last year through internal development as well as via acquisition as the company continues to expand the scope of what is one offer. One of the most central themes was the company’s effort to tackle the emerging market for GenAI services.

Snowflake, like other competitors in the enterprise data space, has now established a GenAI strategy. Overall Snowflake’s approach is to remain AI/ML provider agnostic, instead looking to offer its customers multiple options for LLM providers alongside its other broad range of data management and analysis tools. This approach may seem more open than some competitors in the enterprise data space like Microsoft and Google, who center GenAI offers on their own proprietary LLMs, Snowflake still requires all data to be migrated to its own platform, with its own formats, to take full advantage of offered capabilities and benefits. Nevertheless, Snowflake is making progress in growing its GenAI capabilities through acquisition and partnership.

In H2 2022, the company purchased Applica, a large language model (LLM) focused on extracting insight from unstructured data like text files, which is now available for use by Snowflake Data Cloud customers. Back in May, the company acquired Neeva, a GenAI search tool it plans to embed across its data cloud products and services. Beyond enhancing data analysis with AI and LLM based tools available on its own platform, Snowflake has invested in providing a platform where enterprises can actually run LLM based applications natively within the Snowflake platform, eliminating the need for data egress. As part of SnowPark, Snowflake’s developer platform, the company recently launched SnowPark Container Services, which allows containerized applications to run directly in Snowflake. As part of the compute resources on offer the company has partnered with Nvidia to provide GPU based resources to run LLMs within Snowflake Container Services. In addition to GPUs, Nvidia is also offering its proprietary LLM NeMo to Snowflake customers. Nvidia is not the only Snowflake partner to offer LLM natively inside Snowflake, with LLM’s from AI21 Labs and Reka also available on the platform. The company also hopes to expand the list of native LLM partners for its SnowPark Container services.

Investment in GenAI has seen some pay-off for Snowflake and its customers. As part of the Data Cloud World Tour in Sydney, Commonwealth Bank Australia (CBA) shared its journey in implementing AI, including GenAI, in its operations. Through partnership with H20.AI, a machine learning platform that has native integration with SnowPark, CBA has launched several AI initiatives, including AI analysis of customer documents and enhanced conversational chatbot in the CBA app. Snowflake has strong credential in industries like financial services and should look to for more customer advocates as it pursues GenAI. Overall Snowflake does have a compelling GenAI offer, but lacks the size and financial power of some competitors who are also investing heavily in the rapidly evolving space.