Amazon to invest $4bn in AI start-up Anthropic

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 26 Sept 2023
Andy Jassy, Amazon CEO.
Andy Jassy, Amazon CEO.

Amazon is set to invest $4 billion (R75 billion) in start-up Anthropic, as the tech giant looks to accelerate its artificial intelligence (AI) push.

Anthropic was founded by former executives at OpenAI (the company behind ChatGPT) and recently debuted its new AI chatbot, named Claude 2.

Amazon and Anthropic yesterday announced a strategic collaboration that will bring together their respective technology and expertise in generative AI, to accelerate the development of Anthropic’s future foundation models and make them widely accessible to Amazon Web Services (AWS) customers.

As part of the collaboration, Anthropic will use AWS Trainium and Inferentia chips to build, train and deploy its future foundation models.

The companies will also collaborate on the development of future Trainium and Inferentia technology.

AWS will become Anthropic’s primary cloud provider for mission-critical workloads, including safety research and future foundation model development.

Anthropic plans to run the majority of its workloads on AWS.

After investing $4 billion in the company, Amazon will have a minority ownership position.

Amazon developers and engineers will be able to build with Anthropic models via Amazon Bedrock, so they can incorporate generative AI capabilities into their work, enhance existing applications and create net-new experiences across Amazon’s businesses.

“We have tremendous respect for Anthropic’s team and foundation models, and believe we can help improve many customer experiences, short- and long-term, through our deeper collaboration,” says Andy Jassy, Amazon CEO.

“Customers are quite 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. Our collaboration with Anthropic should help customers get even more value from these two capabilities.”

“We are excited to use AWS’s Trainium chips to develop future foundation models,” says 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. By significantly expanding our partnership, we can unlock new possibilities for organisations of all sizes, as they deploy Anthropic’s safe, state-of-the-art AI systems, together with AWS’s leading cloud technology.”

An AWS customer since 2021, Anthropic has quickly grown into one of the world’s leading foundation model providers and an advocate for the responsible deployment of generative AI, notes Amazon.

It explains that the firm’s foundation model, Claude, encompasses a range of tasks, from dialogue and creative content generation, to complex reasoning and detailed instruction.

Its 100 000 token context window can process extensive amounts of information, Amazon adds.

AI power play

Commenting on the deal, Nigel Green, CEO of financial advisory deVere Group, says: “Amazon’s $4 billion investment in a ChatGPT rival reinforces why almost all investors should have some AI exposure in their investment mix.

“This move highlights how the big tech titan is stepping up its rivalry with other giants Microsoft, Google and Nvidia in the AI space,” he says.

“The AI race is on, with the big tech firms racing to lead in the development, deployment and utilisation of artificial intelligence technologies. AI is going to reshape whole industries and fuel innovation – and this makes it crucial for investors to pay attention and why almost all investors need exposure to AI investments in their portfolios.”

Green explains that while it seems the AI hype is everywhere now, “we are still very early in the AI era. Investors should act now to have the ‘early advantage’.

“Getting in early allows investors to establish a competitive advantage over latecomers. They can secure favourable entry points and lower purchase prices, maximising their potential profits.

“This tech has the potential to disrupt existing industries or create entirely new ones. Early investors are likely to benefit from the exponential growth that often accompanies the adoption of such technologies. As these innovations gain traction, their valuations could skyrocket, resulting in significant returns on investment,” Green comments.

“AI is not just another technology trend; it is a game-changer. Investors need to pay attention and include it as part of their mix.”