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Google plans to invest up to $40B in Anthropic

bloomberg.com

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Re: Google plans to invest up to $40B in Anthropic

#601

Post by notTheLastMan »

argee wrote: post #443
stingraycharles wrote: post #440

Earlier quoted context omitted.

I find it interesting that Anthropic is in this position and not OpenAI. Where did OpenAI go wrong? Lack of focus and overambitious in some of their spending commitments?

Isn’t the only thing OpenAI did was: throwing a half baked model out for the public to go ham on? I was at Google when they did this and we already had working LLMs internally, they just weren’t good enough to release without PR backlash. I don’t see why such a pithy “advantage” should have led to anything other than a moment in the spotlight? The “we have no moat and neither does OpenAI” essay was published very sho…

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Re: Google plans to invest up to $40B in Anthropic

#602

Post by notTheLastMan »

throwawaytea wrote: post #45

If you added up all the major AI valuations, it's apparently worth more than products Americans constantly buy and rely on for their main life. So either AI is going to be involved in every Americans life to a large degree, and paying real money for, or these valuations are insanely wrong.

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Re: Google plans to invest up to $40B in Anthropic

#603

Post by duskdozer »

Capricorn2481 wrote: post #575
com2kid wrote: post #242

Earlier quoted context omitted.

That is ultimately where it is headed and has been headed for over 100 years now. The question is when will we get there. If the answer is tomorrow, money means nothing and none of these investments matter. If the answer is 30 years, well lots of money to be made up until the inflection point of machines being able to design, build, and repair themselves.

You heard AI powered scissors and thought that's where we're heading? I think you'd have to be totally divorced from the average person to believe this. Meanwhile people are still begging car manufacturers to stop locking their glove box behind a touch screen. Or how about a TV that isn't loaded with crappy software that makes it unusable after 2 years. There's a reason we don't put tech in everything.

Well, fortunately (from a certain point of view), it doesn't really matter what people beg for as long as they need the thing anyway and you and your competitors all agree not to give them what they want.

Re: Google plans to invest up to $40B in Anthropic

#604

Post by throwaway2037 »

HappMacDonald wrote: post #560
throwaway2037 wrote: post #533

Earlier quoted context omitted.

> To be honest, I think "vendor financing" is still a very risky premise. Are you aware that all heavy industry in all highly developed nations make extensive use of vendor financing to sell their products? Siemens is a perfect example of a well-run, stable, industrial giant. They offer vendor financing for large purchases. Same for the "heavies" (Mitsubishi, Kawasaki, IHI, Hyundai, Doosan, Hanjin) in Japan and Korea…

Are we replacing "Let me google that for you" with "Here is a prompt to feed ChatGPT" now? Edit: I am not asking whether ChatGPT is better than Google Search, I am asking after the standard dodge of citing one's sources.

Fair point/question. For many of my HN responses, I first ask ChatGPT for a bit of information about the topic. For the case of GE Cap's wrecking of parent GE with excessive financialisation, I could only loosely remember the details from the 2000s. It is a long time ago! That prompt that I shared gave a reply that was 100s of words. Too much for copy/pasta, and too hard for me to summarise briefly. Instead, I decided to share the prompt. It is not my intention to dodge sources. Plus, the newest versions of ChatGPT is pretty good about sharing sources. (Of course, the quality of sources can be debatable.) In short, it was not my intention to be snarky by sharing my ChatGPT prompt.

EDIT ---- Also, the OP was so brief about GE Cap, I realised that most readers under 30 (maybe 35) will have almost no knowledge or memory of that economic history. I wanted to offer an "intellectual carrot" (ChatGPT prompt) for anyone wishing to learn more. ----

What bothered me most about the original post was the person was putting all vendor financing in the same "bad" bucket. I disagree. I would characterise GE Cap as an infamous example! They were the worst of the worst in a generation (25 years). Most vendor financing is very boring and is used to buy big heavy things with very long operational lives. If the buyer goes bankrupt, it is (relatively) easy to repossess the big heavy thing and sell it again (probably with vendor financing again!).

Re: Google plans to invest up to $40B in Anthropic

#605

Post by dvfjsdhgfv »

robjeiter wrote: post #556
netcan wrote: post #534

Earlier quoted context omitted.

So yes, but that doesn't negate the circular investment aspect, for most intents and purposes. The risk is from this structure is mostly to do with how this affects market cap. Companies using the value of their shares to fund demand for their services. That's a risk.

I feel like the whole market at this point is just AI since big tech other than Apple are all massively invested into that. Everyone owns either the S&P or the total world ETF which are both heavily skewed towards big tech and this trade - so literally everybody is in it. It might go well for a few more quarters/years but once something breaks or gets exponentially cheaper this will take down the whole market with it…

> literally everybody

I personally make sure I really diversify, so that when I buy funds, I buy those with stocks of EU companies which pay dividends. AFAICT there are 0 European AI companies that pay dividends.

Re: Google plans to invest up to $40B in Anthropic

#606

Post by throwaway2037 »

paganel wrote: post #570
throwaway2037 wrote: post #533

Earlier quoted context omitted.

> To be honest, I think "vendor financing" is still a very risky premise. Are you aware that all heavy industry in all highly developed nations make extensive use of vendor financing to sell their products? Siemens is a perfect example of a well-run, stable, industrial giant. They offer vendor financing for large purchases. Same for the "heavies" (Mitsubishi, Kawasaki, IHI, Hyundai, Doosan, Hanjin) in Japan and Korea…

> Are you aware that all heavy industry in all highly developed nations make extensive use of vendor financing to sell their products? The OP did mention GE Capital, the motherload of all heavy industry vendor financing. And of massaging the accounting books in order to increase shareholder value in the short term, also.

    > motherload of all heavy industry vendor financing
I doubt they are bigger than other national "heavy industry" champions from East Asia and Western/Central Europe. Without checking, I would guess that the global leaders are Boeing and Airbus.

Re: Google plans to invest up to $40B in Anthropic

#607

Post by fnoef »

simianwords wrote: post #589
fnoef wrote: post #579

$40B. Insane. Imagine what could be done with this money to improve humanity. Instead, it’s spent on a fancy text generator that promises to eliminate most of the non mundane and physical jobs, as well as create autonomous killing machines, on top of burning the entire worlds electricity. Crazy.

Technology and productivity have reduced more death than any redistribution

Who said redistribution?

This money could be invested in universal healthcare, or into AI research for medicine. But hey, I guess replacing developers and generating slop is more beneficial to our society.

Re: Google plans to invest up to $40B in Anthropic

#608

Post by petcat »

cavisne wrote: post #493
stingraycharles wrote: post #440

Earlier quoted context omitted.

I find it interesting that Anthropic is in this position and not OpenAI. Where did OpenAI go wrong? Lack of focus and overambitious in some of their spending commitments?

Does not seem that complicated. OpenAI basically had to do a lock-in deal with Microsoft/Azure at the time, and they pioneered this circular funding hyperscaler deal structure so there were some rough edges. Anthropic (all ex Open AI) knew the negatives of the deal, so they made a slightly better deal with AWS, not a full lock in. They also grounded it in hardware from the start, ie. being the flagship customer for T…

This seems like wild speculation that isn't even really true at all. OpenAI locked up all the compute capacity which is why Anthropic is struggling so badly with capacity to scale for demand. It's why Claude quality is plummeting and people are leaving in droves because the usage limits are pathetic and the API pricing structure is outrageous. All because they can't scale. So that's what this deal is about.

Re: Google plans to invest up to $40B in Anthropic

#609

Post by bojan »

mattbrewsbytes wrote: post #344
skybrian wrote: post #276

Context: a few weeks ago, Anthropic signed a deal to buy "multiple gigawatts of next-generation TPU capacity" from Google and Broadcom [1]. There have been several previous deals, too. Some people call this sort of thing a "circular deal", but perhaps a better way to think of it is as a very large-scale version of vendor financing? The simple version of vendor financing is when a vendor gives a retailer time to pay f…

Reciprocal agreements aren't new, sometimes they're used to gain access to a market the other party already has established a foothold in for other industry segments. These companies operate in the same general industry: tech/internet so it could be complementary services they are each after. So far both of these companies have shown they suck at support so we know that's not it. It could be that it might help Anthro…

I agree those results ate handy, but I had several occasions where they turned out to be completely wrong. 95% correctness rate is not good enough.

Re: Google plans to invest up to $40B in Anthropic

#610

Post by fc417fc802 »

TeMPOraL wrote: post #566
fc417fc802 wrote: post #554

Earlier quoted context omitted.

Don't open models and competition between frontier providers both serve as barriers here? If a frontier provider pivoted as you describe it would certainly change the landscape but they wouldn't be unassailable without developing some sort of secret sauce that gave them an extremely large advantage over everyone else. They'd need a sufficient advantage to pull out far ahead of everyone else before others had a chance…

> If a frontier provider pivoted as you describe it would certainly change the landscape but they wouldn't be unassailable without developing some sort of secret sauce that gave them an extremely large advantage over everyone else. Integration, and mindset. AI, by its general-purpose nature, subsumes software products . Most products today try to integrate AI inside, put it in a box and use to supercharge the product…

I don't understand where the unbeatable edge is supposed to come from here. Don't we already have this in the form of agents using tools? Right now it's CLI but it's not difficult to imagine extending that to a GUI coupled with OCR and image recognition in a way that generalizes.

So suppose ACo attempts to subsume Spotify or Photoshop or whatever. So they ... build their own competing platform internally? That's a lot of work. And now they what, attempt to drive users to it by virtue of it being a first party offering? Okay sure that's just your basic anticompetitive abuse of monopoly I guess. MS got in trouble for that but whatever let's assume that happens.

So now lots of ACo users are using a Photoshop competitor behind the scenes. I guess they purchased a subscription addon for that? And I guess ACo has the home team advantage here (anticompetitive and illegal ofc) but other than that why can't Photoshop compete? It just seems like business as usual to me. What am I missing?

If ACo sells widgets and I also sell widgets, assuming I can get attention from consumers and offer a compelling set of features for a competitive price why can't I get customers exactly? ACo's AI will be able to make use of either widget solution just fine assuming ACo doesn't intentionally sabotage me.

I think the more likely issue is that at some point the cost of building software falls far enough that it ceases to be a viable product category. You just ask an agent for a one off solution and it hands it to you.

Projecting out even farther, eventually the agents get good enough that you don't need to ask for software tools in the first place. You request X, the agent realizes that it needs a tool for that, builds the one off tool, uses it, returns X to you, and the ephemeral purpose built tool gets disposed of as part of the the session history. All of this without the end user ever realizing that a tool to do X was authored to begin with.

So I guess I agree with your end outcome but disagree about the mechanics and consequences of it.

> Open models can't compete

They can though. There's a gap, sure, but this isn't black and white. Plenty of open models are quite useful for a particular task right now.

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