Amazon invests another $4 billion in Entropy

Amazon has announced a new $4 billion investment in Entropic, maker of the artificial intelligence chatbot Claude. With the deal, Anthropic will also use Amazon’s AI chips.

According to an announcement published by Amazon, the tech giant will invest $4 billion in the startup Entropic in its latest round of investments in the field of artificial intelligence, bringing its total investment in this startup to $8 billion. Amazon had previously invested $1.25 billion and $2.75 billion in Entropic in two occasions.

Entropic is one of OpenAI’s serious competitors in the artificial intelligence market

Amazon has announced that the company’s Web Services (AWS) will now be Anthropic’s “primary training partner”. Also, the Claude chatbot, as one of the main competitors of ChatGPT, uses Trainium and Inferentia accelerator chips made by Amazon for future models.

The investment in Entropic coincides with Amazon’s efforts to launch a smarter version of Alexa. Access to Entropic’s technologies and models allows Amazon to equip Alexa with more advanced AI capabilities.

Reuters previously reported that Amazon plans to bring some new AI capabilities to Alexa through a partnership with Entropic. To date, Amazon has delayed the release of an upgraded version of Alexa, but some internal reports suggest that Alexa powered by the Claude chatbot has fared better in tests. Amazon apparently plans to launch an improved version of Alexa in 2025.

According to a report published by Bloomberg last month, the investment of technology giants in artificial intelligence will reach about 200 billion in 2024. Meanwhile, Amazon is the leader in this field with an investment of 75 billion dollars. But despite this amount of investment, Amazon has not yet been able to launch a product that can compete with Microsoft Copilot or ChatGPT. The partnership with Entropic is Amazon’s latest chance to stay ahead of the competition in the artificial intelligence market.