The Amazon.com, Inc. (NASDAQ: AMZN) stock price edged lower despite the company announcing yesterday that it has committed to investing up to $4 billion in Anthropic, an AI startup, as part of the mad rush by leading tech companies to secure a pie of the rapidly expanding Generative AI market.
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The leading e-commerce company has agreed to invest an initial amount of $1.25 billion, with the deal having the capacity to expand to a total investment of $4 billion by Amazon.com upon the achievement of certain milestones as part of the partnership between the two companies.
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The deal specifies that Anthropic will use Amazon’s Web Services product as its primary cloud services provider and will also use Amazon’s custom chips to power its AI software. In the meantime, Amazon will embed Anthropic’s software and models across its business.
Amazon will become a minority shareholder in the startup due to the deal. The deal marks the latest investment by a large tech company this year in the race to become the leader in the Generative AI space following the breakout success enjoyed by OpenAI’s ChatGPT Generative AI.
As part of the deal, Anthropic made a long-term commitment to provide Amazon’s customers access to future generations of its foundation models via Amazon Bedrock. Amazon Bedrock is AWS’s fully managed service that provides secure access to the industry’s top foundation models.
Anthropic has been supporting Amazon’s Bedrock AI offering since April and has noticed significant organic adoption of its Claude AI services by Amazon’s customers. The expanded relationship between the two companies should generate significant benefits for their clients.
Andy Jassy, Amazon’s CEO, said: “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. 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, and our collaboration with Anthropic should help customers get even more value from these two capabilities.”
Amazon.com (AMZN) stock price.
The Amazon.com (AMZN) stock price fell 0.27% to trade at $130.85, from Monday’s closing price of $131.27.
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