As OpenAI's generative AI-based chatbot ChatGPT becomes a global phenomenon, search engine giant Google Inc has invested about $300 million in artificial intelligence start-up Anthropic.

As part of the deal, Google will buy a 10% stake in the start-up, which is testing a potential rival to OpenAI's ChatGPT as both the startups work on generative AI models. The deal also entails Anthropic selecting Google Cloud as its preferred cloud provider, which basically gives it the cloud infrastructure performance and scales it needs to emerge as a serious rival against ChatGPT.

"We're thrilled to be able to partner with Google Cloud on training and deploying useful AI systems," said Anthropic CEO Dario Amodei. "We've been impressed with Google Cloud's open and flexible infrastructure. We are excited to partner with Google to scale up our systems in the coming months."

The investment by Google assumes significance after the recent moves by another tech giant Microsoft, which announced a multiyear, multibillion-dollar investment in ChatGPT owner OpenAI in January 2023 as it looks to commercialise the advanced AI tech across its consumer and enterprise products. Microsoft in 2019 and 2021 had infused more than $1 billion in the company.

“In this next phase of our partnership, developers and organisations across industries will have access to the best AI infrastructure, models, and toolchain with Azure to build and run their applications,” Microsoft CEO Satya Nadella had earlier said on the company’s partnership with OpenAI.

While Microsoft's investment in OpenAI will help it build Azure’s leading AI infrastructure to help customers build and deploy their AI applications on a global scale, Google’s investment in Anthropic will make it a cloud provider to the AI startup. The deal also allows Anthropic to conduct AI research on the same infrastructure that powers Google Search and YouTube.

Google’s investment comes just days after Alphabet CEO Sundar Pichai said the company will soon come up with big language models powered by AI, like its conversational AI model LaMDA, and that it'll work as a "champion to search”. Notably, the popularity of newcomers AI systems like ChatGPT and DALL-E has put Google on the back foot as despite working in the AI space for years, it has not released any sophisticated tools like these.

Anthropic was founded in January 2021 by the team behind AI breakthroughs such as GPT-3 and Reinforcement Learning from Human Feedback (RLHF). Since its founding, Anthropic has published 14 research papers showing how to build “reliable and controllable” language models, the company says.

It’s only this year that Anthropic began deploying its technology publicly, starting off with a language model assistant named Claude. Anthropic is working with a broad range of early partners on deploying Claude, and will be expanding access to the assistant in the coming months.

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