Amazon.com invested another $4 billion in OpenAI competitor Anthropic, as the e-commerce giant moves up against Big Tech rivals in the race to capitalize on generative artificial intelligence technology.
The startup said Friday it doubled Amazon’s investment in the firm known for its GenAI chatbot cloud, but it remains a minority investor. Similar to Amazon’s previous $4 billion investment, it comes in the form of convertible notes and comes in tranches, with the first $1.3 billion.
Anthropic is also in talks with additional investors to raise more capital with the backing of Amazon, said the sources, who requested anonymity to discuss private matters. Anthropic declined to comment.
Amazon, which has gradually established itself as Anthropic’s primary cloud partner, is competing hard with Microsoft and Alphabet’s Google to offer AI-powered tools to its cloud customers. AWS is bringing significant revenue to Anthropic as a major distributor of its latest models.
“The investment in Anthropic is essential for Amazon to remain in a leadership position in AI,” said DA Davidson analyst Gil Luria.
The e-commerce company’s increased investment in Anthropic underscores the billions of dollars pumped into AI startups last year, as investors look to take advantage of a boom in the technology that became popular with the launch of OpenAI’s ChatGPIT in late 2022 .
Microsoft-backed OpenAI raised $6.6 billion from investors last month, which could value the company at $157 billion and cement its position as one of the world’s most valuable private companies.
Anthropic plans to train and deploy its basic models on Amazon’s Tranium and Inferentia chips. The intensive process of training AI models requires powerful processors, making securing expensive AI chips a top priority for startups.
“It (the partnership) also allows Amazon to boost its AI services such as leveraging its AI chips for training and inference, which Anthropic is using,” Luria said.
Nvidia currently dominates the market for AI processors and counts Amazon among its long list of so-called hyperscaler customers.
Still, Amazon is working to develop its own chips through its Annapurna Labs division, which Anthropic said it is “working closely with” to help develop processors. Amazon is also trying to create its own AI model, code-named “Olympus”, which it has not released.
Anthropic, co-founded by former OpenAI executives and siblings Dario and Daniela Amodei, said last year it had secured a $500 million investment from Alphabet, which has pledged to invest another $1.5 billion over time.
The startup also uses Alphabet’s Google Cloud services as part of its operations.
© Thomson Reuters 2024
