US Markets
Thursday, March 28th, 2024 2:35 am EDT
Key Points
- Amazon makes its largest outside investment ever, allocating $2.75 billion to back Anthropic, a San Francisco-based startup specializing in generative artificial intelligence (AI).
- The investment follows an initial $1.25 billion investment announced in September, with Amazon committing to invest up to $4 billion in total. Anthropic competes with OpenAI and ChatGPT, and its foundation model and chatbot, Claude, are considered as front-runners in the field.
- Anthropic’s new suite of AI models, Claude 3, outperforms competitors like OpenAI’s GPT-4 and Google’s Gemini Ultra on industry benchmark tests. The partnership between Amazon and Anthropic involves using AWS as the primary cloud provider and Amazon chips for training, building, and deploying models, reflecting a broader trend among cloud providers to invest heavily in AI to maintain competitiveness.
Amazon is making a significant investment in Anthropic, a San Francisco-based startup specializing in generative artificial intelligence, marking the largest outside investment in Amazon’s history. The investment, totaling $2.75 billion, follows an initial $1.25 billion investment announced in September, with Amazon committing to invest up to $4 billion in total. Anthropic’s foundation model and chatbot, Claude, are considered competitors to OpenAI and ChatGPT. Despite this substantial investment, Amazon will maintain a minority stake in Anthropic and will not have a board seat. The deal was negotiated based on Anthropic’s last valuation of $18.4 billion. Anthropic recently unveiled Claude 3, its latest suite of AI models, which the company claims outperforms competitors like OpenAI’s GPT-4 and Google’s Gemini Ultra in industry benchmark tests. Amazon’s investment in Anthropic is part of a broader trend among cloud providers to invest heavily in AI to maintain competitiveness. Anthropic has also received investments from other tech giants like Google and Salesforce. The partnership between Amazon and Anthropic involves Anthropic using Amazon Web Services (AWS) as its primary cloud provider and Amazon chips for training, building, and deploying its models. This trend of tech giants investing in AI startups has raised concerns about antitrust issues and the potential for circular investment practices. The U.S. Federal Trade Commission (FTC) has initiated an inquiry into these partnerships, including Amazon’s investment in Anthropic, to examine potential market distortions and ensure compliance with regulations. Despite these concerns, Big Tech’s investments in AI continue to grow rapidly, reflecting the increasing importance of AI technologies in various industries.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/03/27/amazon-spends-2point7b-on-startup-anthropic-in-largest-venture-investment.html
