Amazon Invests $4 bn in AI Startup Anthropic to Take on OpenAI’s ChatGPT

Amazon.com has announced a significant investment of up to $4 billion in cash into Anthropic, a startup specializing in artificial intelligence (AI).
Amazon Kindle e-reader
This move is aimed at fortifying Amazon’s position in the AI landscape and enhancing its competitive edge against growing cloud rivals.

Under the terms of the agreement, Amazon’s employees and cloud customers will receive early access to Anthropic’s technology, enabling them to integrate it into their businesses. Anthropic, based in San Francisco, has also committed to predominantly using Amazon’s cloud services, including training its upcoming AI models on proprietary chips purchased from Amazon.

In a joint interview, the CEOs of Amazon’s cloud division and Anthropic revealed that the initial investment will be $1.25 billion, with the possibility of an additional $2.75 billion in funding triggered by either party.

However, specific details regarding Amazon’s ownership stake in Anthropic and the startup’s updated valuation remain undisclosed. Amazon clarified that it would hold a minority position and would not secure a board seat within Anthropic.

Andy Jassy, Amazon CEO, said: “Customers are excited about Amazon Bedrock, AWS’s new managed service that enables companies to use various foundation models to build generative AI applications on top of, as well as AWS Trainium, AWS’s AI training chip, and our collaboration with Anthropic should help customers get even more value from these two capabilities.”

“We are using AWS’s Trainium chips to develop future foundation models,” said Dario Amodei, co-founder and CEO of Anthropic. “Since announcing our support of Amazon Bedrock in April, Claude has seen significant organic adoption from AWS customers.”

This strategic investment by Amazon represents a significant response to the challenges posed by rivals like Microsoft and Alphabet’s Google, which have made substantial advancements in AI. Microsoft, for instance, has invested billions in its collaboration with OpenAI, the creator of ChatGPT, providing exclusive access to its technology for customers.

Google, a pioneer in AI, had previously invested in Anthropic and maintains an ongoing relationship with the startup. Amazon’s investment in Anthropic is anticipated to stimulate demand, particularly for AI-powered chips. Anthropic has committed to developing technology for Amazon’s in-house Trainium and Inferentia chips, Reuters news report said.

Adam Selipsky, CEO of Amazon Web Services, stated, “This pact will help make Anthropic’s models better and improve our chip technology and AI infrastructure.” Dario Amodei, CEO of Anthropic, emphasized that the funding would allow the company to prioritize safety and scale up its AI models.

Anthropic, founded by former OpenAI executives, is at the forefront of generative AI, which simulates human-like content creation. The startup stands out by training AI to adhere to ethical values.

The investment in Anthropic aligns with a previous agreement with Google, where Anthropic uses Google’s custom chips and intends to make its technology accessible through Google Cloud and other platforms. However, this deal significantly bolsters Amazon Bedrock, a service that has already attracted a large user base for building AI applications.

Amazon’s customers will gain early access to Anthropic’s features, allowing for customization of AI. Selipsky stressed the importance of continued collaboration, ensuring that future versions of Anthropic’s AI model, Claude 2, will be available on Amazon Bedrock for years to come.

Claude 2, an advanced AI model developed by Anthropic, specializes in analyzing large prompts, making it suitable for processing extensive business or legal documents.

Amodei expressed that the deal would facilitate closer collaboration to drive enterprise usage for Claude, catering to significant demand on Amazon Bedrock. Anthropic has collaborated with various clients, including LexisNexis, Bridgewater Associates, and Lonely Planet, to enhance their respective services with intelligent AI capabilities.

While Anthropic is yet to achieve the widespread recognition and usage of OpenAI, the startup aims to contribute to Amazon’s extensive range of AI models, positioning Amazon as a leading choice for cloud services in the AI domain.

Related News

Latest News

Latest News