ALBANY — IBM and SUNY Polytechnic Institute are creating an artificial intelligence "hardware lab" in Albany.

The facility will be part of a larger, $2 billion commitment by the company to New York state that will keep IBM in Albany for years to come.

Under the terms of the deal, Empire State Development will provide a five-year, $300 million grant to SUNY Poly for what's being called the AI Hardware Center at the institute's Albany campus. The facility is expected to create hundreds of new jobs.

In exchange, IBM has agreed to extend its presence at SUNY Poly's Center for Semiconductor Research through 2023, with an option for another five-year agreement after that.

IBM's total spending under the deal, both at SUNY Poly and at IBM sites across the state, will be $2 billion over five years — the biggest set of commitments by IBM to the state in nearly a decade.

The deal also lays the groundwork to make SUNY Poly and New York in general a hotbed for AI, which is rapidly revolutionizing how people work, live and interact with their devices.

"New York has always been at the forefront of emerging industries, and this private sector investment to create a hub for artificial intelligence research will attract world-class minds and drive economic growth in the region," Gov. Andrew M. Cuomo said in a statement. "Artificial intelligence has the potential to transform how we live and how businesses operate, ‎and this partnership with IBM will help New York stay on the cutting edge developing innovative technologies."

According to IBM's AI Research division, the computer chips and devices of the past — designed to run spreadsheets and databases — are too logical or straightforward to be able to perform the tasks needed to enable artificial intelligence. AI chips must act more like the human brain and be flexible, which means the chips of the future will have to be designed differently and use different materials and chip architecture.

"AI will transform the world in dramatic ways in the coming year," said Mukesh Khare, vice president of semiconductor and AI hardware for IBM Research. "IBM is pushing the boundaries of AI faster — for the benefit of industry and society. By expanding our partnership with New York State, we are creating a global hub of AI hardware research with an ecosystem to innovate, incubate, and lead in the development of disruptive technologies."

The new AI center will not just involve IBM and SUNY Poly. Rensselaer Polytechnic Institute in Troy will be involved along with Applied Materials and Tokyo Electron, both of which already have operations at SUNY Poly. Applied Materials and the state agreed to jointly fund a $880 million research and development center at SUNY Poly back in November that is expected to collaborate with AI Hardware Center.

IBM has also agreed to spend $30 million on artificial intelligence programs at SUNY schools across the state, with the SUNY system agreeing to contribute $25 million to those program as well.

The idea to spread the research done at SUNY Poly to other SUNY schools and other schools in New York state is part of the new model at the institute that includes closer collaboration with the state system's other campuses.

"Our partnership with businesses continues to foster research breakthroughs and economic growth while working to combat everything from diseases and cancer, to mitigating climate change," said SUNY Chancellor Kristina Johnson.

"We continue to offer a world class education in innovative fields, and artificial intelligence is just one example of how SUNY is investing in new tech clusters to prepare our students for the good paying jobs of tomorrow," she said.