AI Hustle: News on Open AI, ChatGPT, Midjourney, NVIDIA, Anthropic, Open Source LLMs: Amazon's $4B Investment in AI Startup Anthropic: A Game-Changer

Welcome to the OpenAI podcast, the podcast that opens up the world of AI in a quick and

concise manner.

Tune in daily to hear the latest news and breakthroughs in the rapidly evolving world

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If you've been following the podcast for a while, you'll know that over the last six

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To get notified when we launch and be one of the first to build on the platform, you

can join the wait list at AIBOX.AI, the link is in the show notes.

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In a significant step towards kind of staking its territory in this growing world of artificial

intelligence, Amazon has announced just today a multi-billion-dollar investment into Anthropic,

which is of course the AI startup that has been gaining a lot of attention for its Claude

series of chatbots.

I personally use Claude, love Claude because it has a massive context window, so if I need

to just post a ton of documents in there, it can go analyze them and give me feedback

on all of that.

The investment, which is now $4 billion, highlights Amazon's ambitions to really secure a robust

position in generative AI technology in a field where of course Microsoft, Google, a

bunch of the rivals are deeply entrenched right now and they do not want to get left behind.

So let's talk a little bit about the scale of this investment.

While Amazon's investment is really significant, I still think it doesn't really overshadow

Microsoft's reported $13 billion that they put into open AI up till now, right?

I think most recently it was $10, but before that, everyone knew they'd put another billion

in and perhaps there's a couple million or a couple billion more that have also been

in there.

Currently, the high profile leader in AI is ChatGPT, however, Amazon's move marks a significant

new frontier I think in kind of the ongoing competition among these big check giants because

it's really, really starting to have the whole, the AI landscape is looking like a battlefield.

So according to initial comments reported by routers, Amazon is going to invest $1.25 billion

with an option to ramp up the investments by another $2.75 billion.

If the deal reaches its full $4 billion potential, it would represent the largest known investment

ever related to Amazon Web Services, which is of course the world's kind of premier vendor

for on-demand computing power and data storage.

This is really impressive, like people are making all sorts of records.

It's interesting because a lot of people talk about the AI bubble or the AI hype at the

end of this year, you know, people are saying like, oh, you know, it was just kind of this

thing that was going to happen at the beginning of the year.

And I for one, see this fundamentally different to other, you know, kind of investment hype

cycles.

I see like just incredible change.

I think everything is going to change.

Every job is going to be affected and impacted.

I think people are starting to realize this, there's going to come a point where people

realize if they're not on the forefront of this, they're going to get left behind.

This really does impact everything.

And so very, very interesting.

I think this really, this investment by Amazon just goes to say, you know, this isn't something

where there's a big investment at the beginning of the year, $10 billion by Microsoft and

now everything's kind of petering off.

Like things are just ramping up.

Things are just getting started.

Very, very interesting to see how this goes.

But obviously companies are currently pouring billions into this and they know if they don't

like Amazon web servers, AWS, if they do not make these major investments and pull these

big players into their field, let's say Microsoft or they allowed Google to pull them all in,

Amazon would see some significant pain in their company, I believe, as every company

is shifting over to be an AI company.

They need these resources.

So being able to kind of peg, you know, one of the premier AI models like Anthropic and

having them on your platform, really kind of number one shows everyone you're serious.

And number two, I think it's going to help them know what tools to build, how to really

help build out some custom stuff for this AI, the AI capabilities that are needed.

And that's going to help them to attract a lot more talent and more AI companies in the

future.

So let's talk a little bit about kind of the Anthropic advantage and where I see they sit

with this.

So Anthropic has been co-founded by siblings, Dario and Daniela Emody, who are both former

open AI research executives.

Their startup has focused on developing Claude and Claude to chatbots, which are kind of designed

to be, you know, like they kind of laud them as being safer and more reliable than existing

LLMs like ChatGPT and Google's Bard.

Anthropic emphasizes its model can self revise their responses, eliminating the need for human

moderation.

And they also say that they're capable of handling larger prompts, something that I personally

have used.

And you know, kind of this is an advantage for tax like tasks like parsing lengthy business

or legal documents.

I think it really does help.

So I think some of these strategic collaborations and tech integrations that we're seeing here

is really interesting.

I think as part of the substantial deal, Amazon is going to acquire a minority ownership

in Anthropic, right?

This is a big chunk of the company.

When Microsoft bought or invested $10 billion into open AI, they essentially bought 50%

of the company.

So essentially Microsoft controls open AI to a large degree.

And it looks like Amazon, while it's still a minority ownership is really buying a big

chunk of the company here.

So they're going to incorporate the startups cutting edge AI technology into its wide range

of business applications, including Amazon Bedrock, which is a platform aimed at building

AI applications.

However, Anthropic has agreed to use AWS as its primary cloud service provider, right?

Which of course, I'm sure Google is not happy about after giving them $300 million earlier

this year.

And they're going to employ Amazon's custom designed semiconductors for training its

foundational AI models.

So really, they're getting quite ingrained with Amazon at this point.

I think this strategic collaboration extends to offering able to AWS customers early access

to specialized features for model customization and fine tuning.

And I think it serves Amazon's broader goal of becoming a kind of one stop shop for AI

solutions from tip from chip architecture to cloud services and kind of beyond that.

So Google also maintains, right?

Like I mentioned, this interest in Anthropic, they have about, I think they bought roughly

10% of the company for $300 million earlier this year.

So Anthropic is going to continue to partner with Google planning to make its technology

available via Google cloud.

So it's, I don't know, like Google's got a lot of different AI capabilities on Google

cloud.

So it seems like Anthropic will still be over there, but it looks like they're really moving

over AWS to do most of their computational stuff.

So it seems like they didn't completely sever ties with Google, but I mean, to a large degree,

they're really moving past them and embracing, you know, Amazon, who's giving them almost

10x or more than 10 times the money.

So I think this Amazon Anthropic deal also seems poised to disrupt kind of the status

quo and hardware for AI applications.

Nvidia of course, the semiconductor company that has thus far ridden the gender of AI

waived a new heights at past a trillion dollar valuation, like just explosive growth from

Nvidia.

I think they may find a new kind of competition because Amazon's initiative indicates a new

willingness to explore alternative chip solutions for AI applications and it's offering potential

new pathways for the industry to do this, which would essentially get around Nvidia and kind

of the bottleneck that a lot of people are having where there just isn't enough H 100

chips from Nvidia.

So Amazon's partnership alliance with its recent AI focused priorities showcased in last

week's event where essentially they were kind of emphasizing AI powered improvements to

products like Alexa home devices, I think as AI continues to really transform a ton

of different sectors from online shopping to home automation, Amazon's massive investment

in Anthropic here really further solidifies its ambition to be on the forefront of this

kind of technological revolution.

I think this move comes amid a lot of growing scrutiny and responsibility concerning the

safe and ethical development of AI technology.

This is of course why Anthropic is so popular.

This is their whole angle, their whole marketing.

This is, you know, what they really peg themselves as, and I think Anthropics on Anthropics focus

on safer AI really aligns well with the industry wide initiative for kind of responsible AI

development, making yet another layer of significance to kind of this pivotal partnership

that we're seeing here.

So I think it's tech giant giants continue to play some absolutely massive bets on AI.

The Amazon Anthropic deal could serve as a bellwether for future investments and kind

of collaborations in this really rapidly evolving field.

This is definitely a story we're going to continue to follow in the future.

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Machine-generated transcript that may contain inaccuracies.