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Amazon Invests an Additional $4 Billion in Anthropic, an OpenAI Rival
Tech giants have poured billions into AI startups following the success of ChatGPT
By Alyssa Lukpat, WSJ
Updated Nov. 22, 2024
Amazon is investing an additional $4 billion in Anthropic, doubling its investment in the artificial-intelligence startup as it aims to compete in the AI arms race.
Amazon is a minority owner of San Francisco-based Anthropic, which describes itself as an AI safety and research company. Amazon’s investment in Anthropic since last year will total $8 billion.
Amazon, Microsoft, Google and other tech giants have been pouring money into AI startups as they look for the next version of OpenAI’s ChatGPT. Tech companies are racing to produce and commercialize generative AI, systems that have humanlike abilities to communicate and create content. The AI boom has reshaped the tech industry in recent years and companies that don’t invest in the technology could get left behind.
Google agreed last year to invest up to $2 billion in Anthropic. Elon Musk’s xAI has told investors it raised $5 billion in a funding round, valuing the AI startup at $50 billion, The Wall Street Journal reported this week. Nearly $30 billion was invested in generative AI companies last year, according to research firm PitchBook.
With Amazon’s new investment, Anthropic said it planned to work on machine learning hardware and to further develop Claude, its AI assistant that competes with ChatGPT.
Anthropic, founded in 2021, is led by siblings and ex-OpenAI employees Dario Amodei and Daniela Amodei. The company has claimed its technology is safer and more reliable than that of other AI companies.
“We’ve been impressed by Anthropic’s pace of innovation and commitment to responsible development of generative AI,” said Matt Garman, chief executive of Amazon Web Services, the company’s cloud-computing division.
AI startups use cash from tech giants to train advanced AI models and access the scarce computing power needed to develop and deploy AI products. In return, big tech companies get a stake in AI startups they hope will take off.
The investments can have a big initial payoff since the AI startups pay to use the tech companies’ cloud-computing services.
The Journal reported last year that Anthropic committed to spend $4 billion on Amazon’s cloud platform over the next five years.
Investments in AI have come under scrutiny from regulators.
The Federal Trade Commission said in January that it was probing AI investments involving Microsoft, OpenAI, Amazon, Anthropic and Google owner Alphabet. The agency expressed concern that the biggest tech companies would stifle competition in the race to produce and commercialize AI.
U.K. antitrust officials probed Amazon’s previous Anthropic investment but decided in September that it wouldn’t open a formal investigation. The officials concluded the investment didn’t pose a threat to competition in the country. Britain’s antitrust watchdog earlier spared Microsoft from a probe over its links to California startup Inflection AI.
News Corp, owner of the Journal and Dow Jones Newswires, has a content-licensing partnership with OpenAI.
Write to Alyssa Lukpat at alyssa.lukpat@wsj.com
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