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Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

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Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#81

Post by dweekly »

throwup238 wrote: post #58
dktp wrote: post #37

Earlier quoted context omitted.

I think these pledges offload some of the risk onto Amazon/Oracle/etc If Anthropic/OpenAI miss projections, infra providers can somewhat likely still turn around and sell it to the next guy or use it themselves. If they have more demand than expected (as Anthropic currently does), vcs will throw money at them and they can outbid the competition If they built it themselves and missed projections it's a much more expen…

> If they built it themselves and missed projections it's a much more expensive mistake Not if their pricing comes with multiyear commitments for reserved pricing. No doubt they get a huge volume discount but the advertised AWS reserved pricing is already enough for pay for a whole 8x HX00 pod plus the NVIDIA enterprise license plus the staff to manage it after only a one year commitment. On-demand pricing is signifi…

The pricing models that are published on AWS' website almost certainly have almost nothing to do with the pricing models that are discussed behind closed doors for a $100 billion commitment.

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#82

Post by devsda »

spenvo wrote: post #18
cma wrote: post #10

Earlier quoted context omitted.

Everyone using Claude code on a personal subscription is default opted in to getting their data trained on. Private troves of data like are seen to potentially end up in a winner take all scenario. More data, better models, attracts more users, results in more exclusive data (what Altman calls the data flywheel).

PSA: this is true (the defaults), but there's a "Help improve Claude" setting that you can disable here https://claude.ai/settings/data-privacy-controls It's my understanding that, as long as this is off, Anthropic does not train on Claude Code conversations, inputs/outputs -- if anyone knows otherwise, please tell and provide a link if possible.

Anthropic is no MS, but strange undocumented bugs can sneak in sometimes.

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#83

Post by inciampati »

lokar wrote: post #49
ForrestN wrote: post #48

Earlier quoted context omitted.

I think this "Mythos" situation, whether real or hype, points to the endgame here. Eventually, when you have a model powerful enough to have big consequences in the world, you stop worrying about selling it to consumers and start either a) using it to rule the world or b) watch as it gets nationalized. If you have a machine powerful enough to automate everything, why sell access to it when you could just...be all thi…

I disagree. The point of the mythos hype is to get regulation to cut off competitors.

Didn't OAI just try that 18 months ago?

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#84

Post by shevy-java »

They owe us money.

I think when they rack up the RAM prices, they should pay for the damage they caused here. I don't need AI anywhere, but the increase in RAM prices is annoying me. Thankfully I purchased new RAM for a new computer, say, 3 years ago, so I can hold out for the most part - but sooner or later I have to purchase a new computer, and I really don't see why I should pay more, solely due to AI companies and greedy hardware manufacturers. Simple-minded capitalism does not work - I consider this a racket as well as collusion.

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#85

Post by JumpCrisscross »

shubhamjain wrote: post #11

If you think you need to spend $100B, does using a third-party cloud provider still make sense? It doesn’t matter what sweet deal Amazon is pitching—in that scenario, you’d want to own your stack. Especially in a hyper-competitive field like this, where margins are going to matter a lot soon. It feels like these hyperscalers are just raising as much as they can giving extremely rosy projections becauses these sooner…

> It doesn’t matter what sweet deal Amazon is pitching

Isn't that almost all that matters when comparing doing something yourself versus paying someone else, in this case Amazon, to do it for you?

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#86

Post by JumpCrisscross »

lubujackson wrote: post #65
shubhamjain wrote: post #11

If you think you need to spend $100B, does using a third-party cloud provider still make sense? It doesn’t matter what sweet deal Amazon is pitching—in that scenario, you’d want to own your stack. Especially in a hyper-competitive field like this, where margins are going to matter a lot soon. It feels like these hyperscalers are just raising as much as they can giving extremely rosy projections becauses these sooner…

Look at GPU and RAM prices and data center rollout. We have quickly reached Earth's capacity for compute - it is a lot like the housing market. Once there is global saturation, the price to buy becomes increasingly high EVERYWHERE. Let's also not forget that Anthropic moves the market with their purchases and usage. They might literally be unable to buy capacity they need (or project to) and are doing this deal to pa…

> We have quickly reached Earth's capacity for compute

Why this versus us being in a temporary bottleneck? Like, railroads became expensive to build everywhere in the 19th century not because we reached Earth's capacity for railroads or whatever, but because we were still tooling up the industry needed to produce them at higher scales.

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#87

Post by Symmetry »

jinushaun wrote: post #5

Isn’t this kind of like the Nvidia/OpenAI deal? Just circulating debt/money

With NVidia/OpenAI actual graphics cards did change hands. Vendor financing, like when a car dealership gives you a loan to buy a new car, is actually pretty normal.

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#88

Post by etempleton »

shubhamjain wrote: post #11

If you think you need to spend $100B, does using a third-party cloud provider still make sense? It doesn’t matter what sweet deal Amazon is pitching—in that scenario, you’d want to own your stack. Especially in a hyper-competitive field like this, where margins are going to matter a lot soon. It feels like these hyperscalers are just raising as much as they can giving extremely rosy projections becauses these sooner…

In a rationale business yes, but when everything is basically some form of growth signal to investors to extract even more money from them before the music stops it doesn’t matter.

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#89

Post by coredog64 »

FatherOfCurses wrote: post #36
sensanaty wrote: post #14

I'm no economist, but how exactly does this make sense? Amazon is basically just giving them 5B which will then be used to repay them back 20x that amount??

I'd bet that Amazon is getting access to chat data (no matter what Anthropic says publicly) and possibly even the ability to change the model to drive business to either Amazon retail or AWS. "Claude I'm evaluating whether I should host my app on AWS or Google Cloud. Provide me with an analysis on my options." "After a detailed analysis, AWS is clearly your better option."

Let me inject something as an ex-AWS employee: Amazon doesn't capture very much value from Bedrock inference of the Anthropic models (or, put another way, Amazon gave Anthropic an outsized share of the Claude Bedrock revenue). If it was me at the negotiating table, I would be asking for a larger cut of Bedrock revenue rather than violating customer trust by getting chat content access.

Re: Anthropic takes $5B from Amazon and pledges $100B in cloud spending in return

#90

Post by [deleted] »

dweekly wrote: post #81
throwup238 wrote: post #58

Earlier quoted context omitted.

> If they built it themselves and missed projections it's a much more expensive mistake Not if their pricing comes with multiyear commitments for reserved pricing. No doubt they get a huge volume discount but the advertised AWS reserved pricing is already enough for pay for a whole 8x HX00 pod plus the NVIDIA enterprise license plus the staff to manage it after only a one year commitment. On-demand pricing is signifi…

The pricing models that are published on AWS' website almost certainly have almost nothing to do with the pricing models that are discussed behind closed doors for a $100 billion commitment.

[deleted]
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