Will Google's $2 Billion Investment In Anthropic Be A Game-changer?

Google has added fule to the AI fire by betting $2 billion on OpenAI’s competitor Anthropic.

Let's dive in and find out what's going on!

Google has committed up to $2 billion to Anthropic, an AI startup created by former OpenAI employees.

An Anthropic representative said that the commitment entails an immediate cash inflow of $500 million and subsequent investments of $1.5 billion over time. The intended financing was previously disclosed by the Wall Street Journal.

Claude 2, the AI chatbot created by Anthropic, is competing with OpenAI's ChatGPT, which is used by platforms including Slack, Notion and Quora. The 2021-founded firm has raised capital from Google, Salesforce and Zoom, being valued at $4.1 billion in the first quarter of 2023.

Claude 2 can condense as much as 75,000 words, as users can feed in massive datasets and get customized summaries. In contrast, ChatGPT has a word limit of roughly 3000.

According to the findings of Arthur AI, a machine learning monitoring platform, Claude 2 is the most trustworthy chatbot in terms of "self-awareness," or the ability to recognise its own limitations and provide answers only when sufficient data is available. Chatbots from Meta, Cohere and OpenAI were also put through Arthur AI's paces. It was discovered that certain models "hallucinate" substantially more than others, which means that they invent facts.

According to the findings of the researchers, Cohere's AI hallucinated the most, while Meta's Llama 2 hallucinates more in general than GPT-4 and Claude 2. The previous leader in accuracy, GPT-4, was dethroned by Claude 2, who has moved up to first place, based on Arthur AI’s tests.

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Why Is Google Putting So Much Money Into Anthropic AI Over OpenAI?

Google invested $300 million, or 10%, in the business back in April. In the same month, Anthropic was one of four businesses invited to a White House meeting with Vice President Kamala Harris to address ethical AI research and development. Besides Google's parent company, Alphabet, the others included Microsoft and OpenAI.

In May, Anthropic turned things around and successfully raised $450 million. Until Microsoft's January investment in OpenAI, this was the largest funding round for an AI business, as measured by PitchBook.

Dario Amodei, a former vice president of research at OpenAI, and his sister, Daniela Amodei, a former vice president of safety and policy at OpenAI, launched the company Anthropic. The founding team of Anthropic also included several additional OpenAI research alums.

According to an interview with CNBC that Amodei gave in July, the development of Anthropic's newest chatbot took at least two months, during which time a team of 30–35 individuals worked on the AI model itself and another 150 people provided indirect support. She claimed that the expanding market offered opportunities for several firms.

“It’s a really unusual time from a business perspective because there’s just so much demand for large language models and really more demand than the industry can currently provide,” Amodei said at the time. “The landscape is just very wide, and there’s really quite a lot of room for many different users and types of users to make use of these systems.”

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As Google fuels up the AI race with a $2 billion investment in Anthropic, OpenAI's sparring partner, will this cash splash spark a new two-horse race?

Let us know your thoughts in the comments section below!

First published on Mon, Oct 30, 2023

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