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(Bloomberg) — BCE Inc. reached a deal with Cohere Inc. and other Canadian firms to provide data center capacity and compute to operate artificial intelligence models, continuing the telecom company’s push to expand its AI strategy.
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That capacity will come from BCE’s Merritt, British Columbia data center, the companies announced Thursday. A division of Hive Digital Technologies Ltd. will deliver AI cloud computing services using hardware from Quebec-based Hypertec Group Inc. Toronto-based Cohere will use the computing power to run its AI models, which serve government and business customers.
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BCE Chief Executive Officer Mirko Bibic said the initiative was “fully Canadian from top to bottom.”
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It’s “a real practical illustration of our Canadian Sovereign AI Alliance in action where we’re putting AI into production,” he said in an interview. Canada’s new AI strategy, unveiled this month, is aimed in part at ensuring the country isn’t as reliant on superpowers such as the US.
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Analysts led by TD Cowen’s Vince Valentini viewed the partnership “as incrementally positive” for BCE, reinforcing the long-term value proposition the firm’s AI strategy. The telecom’s shares were trading nearly flat in Toronto at C$32.92 as of 10:32 a.m.
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The contract is worth $220 million over three years for Hive, which is incorporated in British Columbia and has its head office in San Antonio. Hive shares rose as much as 12% in Toronto after the deal was announced, before paring that gain to 4.5% as of 10:32 a.m.
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BCE first partnered with Cohere nearly a year ago to integrate the startup’s AI models into its enterprise services. Growth in BCE’s AI businesses helped the firm beat analyst expectations in the first quarter. The telecom expects revenue from AI-powered solutions to rise by at least C$500 million ($356 million), to C$2 billion, by 2028.
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Another BCE data center, a 300-megawatt facility, is being built in Saskatchewan in partnership with Coreweave Inc. and Cerebras Systems Inc.
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