Amazon escalates AI arms race with additional $4B investment in OpenAI rival Anthropic

Anthropic said Friday that longtime backer Amazon had pumped an additional $4 billion into the artificial intelligence startup, doubling its investment in the firm known for its GenAI chatbot Claude.Amazon will maintain its position as a minority investor and will be Anthropic’s main training partner for AI models, the startup said.Amazon, which is Anthropic’s primary cloud partner, is fiercely competing with Microsoft and Alphabet’s Google to offer AI-powered tools for its cloud customers.The e-commerce company’s increased investment in Anthropic underscores the billions of dollars funneled into AI startups over the past year, as investors look to capitalize on a boom in generative AI technology, which became popular with the launch of OpenAI’s ChatGPT in late 2022.Microsoft-backed OpenAI last month raised $6.6 billion from investors, which could value the company at $157 billion and cement its position as one of the most valuable private companies in the world.Anthropic plans to train and deploy its foundational models on Amazon’s Trainium and Inferentia chips.The intensive process of training AI models requires powerful processors, making securing pricey AI chips a top priority for startups.Nvidia currently dominates the market for AI processors and counts Amazon among its long list of so-called hyperscaler customers.Still, Amazon has been working to develop its own chips through its Annapurna Labs division, which Anthropic said it was “working closely with” to aid in developing processors.Britain’s competition regulator had said in September that Amazon’s partnership with Anthropic would not be referred for a deeper probe as it did not fall under its jurisdiction.Anthropic, co-founded by former OpenAI executives and siblings Dario and Daniela Amodei, said last year it had also secured a $500 million investment from Alphabet, which promised to invest another $1.5 billion over time.The startup also uses Alphabet’s Google Cl...