GenAI Race Heats Up: Amazon To Invest Up To $4B In Anthropic

‘What we are seeing is the early stages of an AI race as to who is going to be able to come up with a monetizable AI product,’ Pinnacle Technology Partners’ Ethan Simmons tells CRN.

The land grab for generative AI capabilities heated up Monday with Amazon disclosing plans to invest up to $4 billion in Anthropic, a top competitor to ChatGPT maker OpenAI.

Amazon announced the minority stake investment as part of a strategic agreement with the San Francisco-based, two-year-old startup founded by former OpenAI executives Dario Amodei and Daniela Amodei.

[Related: Adam Selipsky: AWS Is Building ‘The Ultimate’ GenAI Tool Chest]

The Amazon funding for Anthropic comes nine months after Microsoft invested $10 billion in OpenAI as part of an all-out AI sales offensive that included the release last week of Microsoft 365 Copilot. For $30 per user, per month, M365 Copilot adds GenAI capabilities to Microsoft Teams, email, files and documents.

Anthropic’s Claude 2, which was unveiled in July, is seeking to go head-to-head against OpenAI’s popular ChatGPT.

“What we are seeing is the early stages of an AI race as to who is going to be able to come up with a monetizable AI product,” said Ethan Simmons, managing partner of Pinnacle Technology Partners (PTP), a cloud consultancy and AWS life sciences solutions superstar. “Microsoft has done some of that work to get customer-facing revenue with Copilot, while AWS has its Bedrock [fully managed AI] service, which is something partners and customers are using to build solutions. The Amazon investment in Anthropic will help create monetizable AI products faster for AWS and its partners.”

Simmons said he sees the Amazon investment as part of a bigger AWS AI sales offensive that will open the door to new applications and tools that can be monetized by AWS partners.

“There has been so much hype and marketing around AI with a focus on chips, hardware and infrastructure,” he said. “The question is, what are the applications that are going to drive the consumption of AI for businesses and consumers? Over the next year or two, we are going to really see whether we can make money using these tools. The opportunity could be enormous. Right now we are still trying to figure out how [to] monetize this and get it into customer’s hands to make them more productive.”

PTP, for its part, is moving fast to help its life sciences customers capitalize on the benefits of AI technology. This week, for example, PTP is hosting an AI driven computational drug discovery seminar for its customers.

“We are actively continuing to invest in, build and enhance our AI practice,” said Simmons. “We’re looking at early use cases around life sciences and how life sciences companies can use to AI to accelerate drug discovery. We are seeing immediate use cases that could lead to life changing drug discoveries.”

As for AWS’ AI channel investments, Simmons said he has been heartened by the influx of top Cisco channel talent into the AWS channel organization. “Cisco is the gold standard for the channel,” he said. “I have high hopes that AWS is going to develop a channel program that could be on par with the Cisco program.”

The Amazon investment is part of a deeper strategic collaboration that includes a commitment by Anthropic to use AWS’s training chip Trainium and AI accelerator chip Inferentia to build, train and deploy future AI foundation models. In fact, AWS and Anthropic said they will work together on future Trainium and Inferentia technology.

Anthropic said it is also making a long-term commitment to provide AWS customers with access to future generations of its AI foundation models through Bedrock.

“What we are seeing is the big technology companies acquiring AI monopoly real estate to be able to better position their companies to take advantage of what AI is going to be in the future,” said Bob Venero, CEO of Fort Lauderdale, Fla.-based Future Tech Enterprise – No. 76 on CRN’s Solution Provider 500. “There is an AI enablement race taking place in the technology solutions market. This could potentially be more disruptive than anything I have seen in 27 years in the technology solutions business. This is so fast-moving and powerful that it has the potential to change the world as we know it. We have to be careful about AI. We need to really look at the risks and the need to put guidelines around it.”

Venero compared the current AI landscape to the same kind of frenzy that took place at the advent of the cloud computing era when technology companies and partners moved to leverage the technology to drive business outcomes.

“AI is like cloud when it became the next big thing with many companies and people trying to get a grasp on what it would mean for customers and partners,” he said. “We are seeing the same thing with AI, where you have this amazing technology and it has to be tuned for business outcomes.”

Venero said he sees the Amazon investment in Anthropic as a positive move that will benefit the channel as long as as there is a focus on the safe use of AI.

Venero, a top Nvidia partner, said he sees the big winners in the AI land grab as Nvidia — which is providing the high-powered GPUs that will power AI applications — and solution providers who will play a lead role helping customers build the AI-powered applications that will deliver business outcomes.

“Nvidia and its partners are going to be the big winners here,” he said. “Nvidia is supplying the engine that runs next-generation AI applications. They are an AI enabler.”

Future Tech, a one-time Nvidia Americas public sector partner of the year, has played a key role helping Fortune 500 companies adopt AI-powered solutions.

“The key with AI is to make sure as a partner, you are driving business outcomes rather than AI for just AI’s sake,” he said. “The channel is good at laser focusing on what business outcomes the customer needs, and then utilizing best-of-breed technologies to drive those business outcomes.”