Report Says Amazon May Be Negotiating New Anthropic Investment

Amazon is reportedly in talks to make a second multibillion-dollar investment in artificial intelligence (AI) startup Anthropic, mirroring its initial $4 billion deal from March 27. As reported Thursday (Nov. 7) by The Information’s Anissa Gardizy, this deal could have a catch.

The report said Amazon is pushing for Anthropic to use a significant number of servers powered by Amazon’s own AI chips, known as Trainium. This request comes as Anthropic currently prefers using Amazon servers equipped with Nvidia-designed AI chips. The final investment amount, The Information says, could hinge on the number of Amazon chips Anthropic agrees to incorporate, highlighting the complex dynamics between cloud providers and AI developers.

As the article points out the negotiations — no word on how far along they’ve progressed — underscore the competing priorities within AI alliances, reminiscent of the Microsoft-OpenAI partnership that has faced recent challenges.

For Amazon, promoting its Trainium chips could reduce reliance on Nvidia hardware and potentially lower costs, the report said. However, Anthropic may face technical hurdles in adopting Amazon’s chip technology, as the associated software is less mature than Nvidia’s widely used Cuda platform. Additionally, such a shift could potentially limit Anthropic’s flexibility in using other cloud providers or leasing its own data centers in the future, as the report said Amazon’s hardware is not available in facilities operated by other companies.

Amazon made its initial $1.25 billion investment in Anthropic in September 2023 and then upped it to $4 billion in March. “Anthropic’s visionary work with generative AI, most recently the introduction of its state-of-the-art Claude 3 family of models, combined with Amazon’s best-in-class infrastructure like AWS Trainium and managed services like Amazon Bedrock further unlocks exciting opportunities for customers to quickly, securely and responsibly innovate with generative AI,” Swami Sivasubramanian, vice president of data and AI at Amazon Web Services (AWS), said in the release announcing the deal at that time.

As part of that agreement, Anthropic used AWS as its primary cloud provider, Anthropic used AWS Trainium and Inferentia chips for its future AI models and made “a long-term commitment to provide AWS customers with access to future generations of its foundation models on AWS’ fully managed service, Amazon Bedrock,” the release said.

For all PYMNTS AI coverage, subscribe to the daily AI Newsletter.