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Competing with ChatGPT, Google has invested nearly $400 million in an AI startup

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Google has invested nearly $400 million in AI startup Anthropic, which is testing a competitor to OpenAI chatbot ChatGPT, according to people familiar with the matter.

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Google and Anthropic declined to comment on the investment but announced the partnership separately. In this cooperation, Anthropic will use Google’s cloud computing services. The deal marks the latest alliance between tech giants and AI startups as competition heats up in the field of generative artificial intelligence (AIGC).

The deal gave Google a roughly 10 percent stake in Anthropic, the people said. Google’s move underscores the influence tech giants already have over other companies working on AI research. These AI companies need access to large cloud computing platforms to help improve giant AI models.

“AI has become one of the biggest drivers of technological change, creating new opportunities for growth and improved services across all industries,” Google Cloud CEO Thomas Kurian said in a statement. We are providing an open infrastructure for the next generation of AI startups, and our partnership with Anthropic will be an excellent example of how we can help users and businesses harness the power of reliable, responsible AI.”

Anthropic, founded in 2021 by former OpenAI executives, released a chatbot called Claude in January for testing to compete with OpenAI’s popular ChatGPT.

Before Google invested, Anthropic had raised more than $700 million in funding. The company’s largest investor is Alameda Research, the crypto hedge fund of cryptocurrency exchange FTX founder Sam Bankman-Fried, which invested in the company before filing for bankruptcy last year. $500 million.

Google’s partnership with Anthropic follows Microsoft’s announcement that it will invest nearly $10 billion in OpenAI. As early as 2019, Microsoft invested $1 billion in the latter.

The alliance of tech giants and AI startups has given established companies such as Microsoft and Google access to the most popular and advanced AI systems available. In turn, start-ups like Anthropic can get much-needed development funding and cloud computing resources from tech giants. In announcing the deal, Google said its cloud computing unit will provide computing power and advanced AI chips that Anthropic plans to use to train and deploy its future AI products.

Anthropic’s language model assistant, Claude, has not yet been released to the public, but the company says it plans to expand its use of chatbots in the coming months.

The deal shows how bullish Google is on the potential of AI, especially in expanding it beyond the company’s core search business. “I’m excited about the AI-driven leap forward we’re about to deliver in search and beyond,” Alphabet Chief Executive Sundar Pichai said Thursday during the company’s fourth-quarter earnings call.

He said Google intends to release its own chatbot “in the coming weeks and months” and allow consumers to use the product “as a companion to search.”

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