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Amazon Enters AI Arms Race with $4 Billion Investment in Anthropic

Amazon is reportedly investing up to $4 billion in AI startup Anthropic, taking a minority ownership stake in the company. This serves as Amazon’s entry into the AI arms race, a crowded field featuring Google, the partnership between ChatGPT developer OpenAI and Microsoft, and many other players.

Amazon and Anthropic revealed the deal on Monday, announcing that it is part of a broader collaboration between the two companies in order to develop foundation models that support generative AI systems, according to a report by ABC News.

Foundation models, also known as large language models, are technologies that function as platforms for AI applications. They are trained by using vast pools of online information, such as blog posts, digital books, articles, and music — to generate text, images, and video content that appears to have been created by a human.

The agreement also reportedly makes Amazon the AI startup’s primary cloud computing service. Anthropic will also be able to use the online retail giant’s custom chips in order to train and deploy its generative AI systems.

The San Francisco-based startup was founded by former staffers of OpenAI, the company responsible for the popular leftist AI chatbot, ChatGPT. Anthropic has already come out with its own ChatGPT rival, Claude, which is currently available in the UK and United States.

The latest version of Claude is capable of “sophisticated dialogue and creative content generation to complex reasoning and detailed instruction,” Anthropic said.

Amazon has reportedly been scrambling to keep up with its own rivals by launching new services, including an update for Alexa, giving users the ability to have more human-like conversations with the virtual assistant. The tech giant has also implemented AI-generated summaries of product reviews for its consumers.

In 2019, Amazon’s rival, Microsoft, invested $1 billion in OpenAI. At the beginning of 2023, the tech giant extended its partnership with the firm, announcing a new “multiyear, multibillion-dollar” investment.


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