Google pumps fresh US$1b into OpenAI rival

Google is making a fresh investment of more than US$1 billion (HK$7.8 billion) into AI startup Anthropic, the Financial Times reported on Wednesday.

This comes after Reuters and other media reported earlier in January that Anthropic was nearing a US$2 billion fundraise in a round led by Lightspeed Venture Partners, valuing the firm at about US$60 billion.

The FT said that Google's new investment was separate from the Lightspeed funding round.

Anthropic, a major competitor of OpenAI in the AI foundation model space, declined to comment.

Google already has an existing commitment of US$2 billion in Anthropic, while e-commerce giant Amazon doubled its stake in the AI company to US$8 billion late last year.

Anthropic, whose annualized revenue hit about US$875 million, sells access to its models directly and through third-party cloud services including Amazon Web Services.

The development of large language models requires expensive computing as well as top talent.

Microsoft-backed OpenAI triggered an AI arms race after it launched ChatGPT in November 2022. The growing popularity of the company and new product launches helped it close a US$6.6 billion funding round in October, potentially taking its valuation to US$157 billion.

REUTERS