It's more understanding for Amazon or Microsoft to make such an investment, because they're not as competitive in the model space.
Google buys Anthropic.
Microsoft buys Open AI (or vice versa depending on how things go).
SpaceGrok buys Cursor, limps along in 3rd place.
Meta is the last man standing, get's stuck with Oracle, dies.
Edit: I forgot Amazon. Who knows what they will do. They're the wildcard anyway.
Anything to invigorate the desktop.
Microsoft buying OpenAI.. 10 minutes later it's rebranded Copilot.. and.. nothing much changes in the world. Oh, except all the AI improvements are around Enterprise governance.
Why the euphemism? What Anthropic did was an aggressive degradation of their model to save compute, and it's not just “perceived downtrend”, Anthropic themselves have acknowledged the quality of service degradation.
Didn't Amazon AWS do the same recently?
I don’t know what to make of it
"Attention Is All You Need" was a very very different thing and I also wonder if they are glad they published it. But I imagine if they hadn't, the motivation for researchers to leave Google would have been even larger.
I don’t think that’s the ultimate cause of the turnaround in fortunes. But it strikes me, at least from the investor and potentially urban-consumer perspectives, as a pivotal moment in both companies’ fortunes.
Sure. Neither OpenAI or Anthropic do. Amazon and Google have followed institutional investors bidding up Anthropic over OpenAI in private markets, all of which—I suspect—followed user-pattern shifts following the fiasco. (Well, fiascos. Altman is a host unto himself.)
Opposite of what you said. The "dig" was not retrenching to more use, but rather I evaluated what I saw them doing and have migrated our company to much better options.
Ant's recent rise has little to none to do with retail subscribers, it is Claude Code with Opus 4.5+, followed by their Mythos stunt
I would say the flood of $20 Claude Subscribers due to news cycle backfired on them, now everyone is getting worse outputs and exposed their shortage on compute, which they can't fix anytime soon.
Pretty much everyone I know has both cc and codex now, just because how unreliable cc has become.
This is a good hypothesis. I suspect we are both correct.
The PR boost from Anthropic standing its ground drove signups. That, in turn, drove investors. But the users also drove utilization, which degraded quality across the board.
My hypothesis rests on Anthropic’s user mix having significantly shifted to consumers (versus enterprise) after the mix-up. Whenever we get public numbers it would be interesting to test that.
I think it was psychological to a degree. For many consumers OpenAI, or at least ChatGPT was AI. The controversy was enough for folks to be introduced to competitors in the AI space and suddenly OpenAI's success felt a lot less inevitable.
I agree with OP though that this won't actually be the cause of OpenAI's downfall, should it happen. But I still think it's an interesting inflection point.
This is my suspicion. Consumers hadn’t previously heard of Anthropic and Claude. Now they had, particularly in cities.
> this won't actually be the cause of OpenAI's downfall, should it happen. But I still think it's an interesting inflection point
Also agree. Hence why I said “I don’t think” the fight is “the ultimate cause.”
Of course this is part of what has lead to such insane demand and outages they've experienced since then.
This is true. OpenAI WAS the story of AI, now it is just 50% of it, at max. Losing the monopoly of imagination towards AGI is bad for them.
One thing I don't agree though, consumers aren't the important part of AI, they are a liability.
AI is too expensive, consumers can't pay for it. Instead they will compete with enterprise for the same tokens, with less money.
"Stunt", eh?
Individually, yes. Anthropic surging in private markets the weekend after the supply-chain risk designation, and raising from not only Google but also Amazon in such short clip (following credibly reports of it turning down $800+ billion valuation cheques from financial investors), all while OpenAI gets pilloried in the press and struggles to hold its $800bn valuation in private markets, collectively—to me—paints a bigger picture.
lol hes barely done anything, but sometimes that is all that's necessary when a bozo opponent is hell-bent on screwing things up. He didn't get fired the first time for no reason.
this is insane. on the secondary market the valuation is 2-3x that. what gives?
Correct. But I think $5 to 10bn are sitting ready for $700 to 800, which strongly implies Google is getting a solid deal on this.
If you gave anthropic 10b cash they couldn't get chips in the 0-6mo timeframe at scale. Anthropic is suffering reputational damage due to choices they have to make around capacity constraints.
Google, AWS, and Azure are the only people who can help them so they hold the cards, thus the good terms.
Google's deal from prior rounds likely lets them buy in at the same valuation other investors get every round, so they're just getting the February valuation.
Amazon did almost the same thing last week, at the same valuation.
It is not uncommon to keep a round open after the formal announcement for a bit so that few investors who could not close for whatever reason are part of it. It can be hard to line up everyone at the same time, especially when they are public companies.
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Specific to your point on why valuation can be lower than market at the same time - Goods(and stocks) while feel to be homogeneous, divisible, fungible, they are not. Size can value of its own.
A block of 10% shares may be worth more (or less) than unit share price, because them being available together has a property of its own, making it either more desirable when someone wants to acquire or harder to sell because there is not enough demand if all of them get dumped at the same time [1]
In this deal terms, just cause few ten millions are trading at $850B, or some investors can put in say $1-2B doesn't mean you can raise $40B at the same valuation.
There isn't depth in the market to raise $65B (including the AMZN deal) at $850B valuation. There is always some demand at any price point in the demand supply curve, you will probably find few people who will buy few shares at $10T, or $100T or some ridiculous number but that doesn't mean you can raise a large round on that.
Strictly speaking it is not even $350B per se, i.e. Google and AWS benefit from this as vendors. It very much like vendor financing with convertible debt. Meaning it is worth that much to them, but not to you and me because we are not getting some of the money back as sales that boosts are own stock.
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[1] In the same vein, price can also depend on what you are getting in return, hard immediate dollars is the highest value. However if you are getting shares in return, you can usually negotiate a premium depending on risk of the shares you are getting.
The recent SpaceX - Cursor deal is a good example, any founder would likely take say $10B all cash offer over the $60B from SpaceX, or price would be closer to cash if it GOOG, AMZN, APPL shares instead - proven deeply liquid market etc.
The tech is great but valuations are out of control. It's cheaper to keep valuations high through these circular financing deals, rather than to allow for any deflation.
anthropic is the anchor external customer of tpu's and nvidia is worth more than all of google. If tpu's actually breakout as a viable alternative over the next few years for multiple clients the business could easily be worth as much as search, maybe more.
Why haven't they broken out yet, I wonder, if they're more efficient for inference and LLM costs are now weighted towards inference over training?
What's the explanation behind this? I am sure they use AI in their ad network (matching web sites with ad offerings, maybe generating ads automatically), but is there more to it?
If only Apple could pass the favor forward. But no, they can't be bothered to invest even a single million in Asashi Linux to benefit their own hardware.
What are you counting in this category?
My neighbors just gave Ford $60k. It'll be a while until my neighbor gives Anthropic $60k.
Now count the Amazon deliveries in a year on said same street. And next year, and the year after, and.. however long one keeps a Ford these days..
It's quite a scary thought exercise.
How much of that 60K does Ford actually keep? And how much will it be once BYD is allowed in the US? The forecast for Ford is pretty much only downwards, the possible upside on AI is huge.
If every company in the F500 starts spending $2000+ on AI credits per employee, then every consumer product will indirectly be funding AI companies. I think it's already the case that companies small enough to avoid/skip getting O365 or Google Suite subscriptions will pay for AI first.
$1k for a lot of developers here is totally worth it.
Computer costs keep collapsing. Image and audio generation is turned out to be less computer intensive than text (lol).
First company to launch 24/7 customized streaming AI slop wins!
AI company revenues aren't driven by consumer subscriptions.
The people doing $20 or even $200 per month plans for their side projects aren't driving the demand. It's going to be business customers spending $1000/month or more per developer and all of the companies feeding their business processes through the API like call centers, document processing, and everything else.
If you're thinking of AI companies as consumer plays you're only seeing the tip of the iceberg. We get cheap access to Claude because they want us playing with it so when it comes time for our employers to choose something we can all lobby for Anthropic.
They should stop messing with us then. Stealth model changes, threatening to take code away on the $20 plan, the list goes on.
So from that point of view you can indeed look at it as the entire value of the economy should be invested into AI companies.
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.
That kind of insane growth & demand is unprecedented at that scale.
https://www.anthropic.com/news/google-broadcom-partnership-c...
Given the fact that both Altman and Amodei are pathological liars, there's absolutely no reason to believe that Anthropic has $30B ARR.
(I would then argue that he was re-hired specifically because others involved with OpenAI understood that it is literally his job to lie and that OpenAI would not be where it is today as a corporate behemoth rather than a research non-profit without a world-class liar marketing it, but that is merely conjecture.)
Can you explain how that’d work? What would the $30B figure be based on if they only have $100 in revenue?
(That said, their numbers are much realer than that.)
(Run Rate = Revenue in Period / # of Days in Period x 365)
That said, most people would use a monthly or quarterly period to estimate ARR. I'm not sure what Anthropic used. Probably monthly.
If your two year old start-up sales Director told a team of agents "our run rate is 2 million a month" and he's basing that on 3 months of sales in the busy season, for the first time ever, that's a prime example of a run rate being exaggerated.
On that other hand, financial engineering has never been more advanced. So who knows what to suspect remains accurate when these IPOS are let loose later on in the year.
I presume I'm not the only one.
it's trivial to reimplement a better solution.
Also, I am not sure if it is trivial to implement. The code is injected into many scenarios and workflows, so replacement will be painful and risky if new solution break some edge case.
[waits for chickens to come home to roost]
"We are writing down X billions over 4 years, and have cancel several ambitious programs related to our AI experiments. We were following standard practice in the industry, so [shareholders] can't blame us for these chickens coming to roost. If everyone is guilty, is anyone really guilty?"
It's now trivial to fix these problems while still doing our day jobs -- shipping a product.
This will have previously been too ambitious to ever scope but we’ve been able to build essentially all of it in just two months. Since it sits on top of our other systems and acts as more of a window/pass through control pane, the fact that it’s vibe coded poses little risk since we still have all the existing infrastructure under it if something goes awry.
Barely an hour goes by without a new 4-page document about something that that everyone is apparently ment to read, digest and respond to, despite its 'author' having done none of those steps, it's starting to feel actively adversarial.
I guess you gotta look busy. But the stick will come when the shareholders look at the income statement and ask... So I see an increase in operating expenses. Let me go calculate the ROIC. Hm its lower, what to do? Oh I know, lets fire the people who caused this (it wont be the C-Suite or management who takes the fall) lmao.
You could argue that all the spending is wasted (doubtless some is), but insisting that the decision is being made in complete ignorance of financial concerns reeks of that “everyone’s dumb but me” energy.
Round-tripping used to be regulated. SPVs used to be regulated. If you need a loan you used to have to go to something called a bank, now it comes from ???? who knows drug cartels, child traffickers, blackstone, russians & chinese oligarchs. Even assuming it doesn't collapse tommorow why should they make double digit returns on AI datacenters built on the backs of Americans?
I run a team and am spending my time/tokens on serious pain points.
This the the difference between intentional and incidental friction, if your CI/CD pipeline is bad it should be improved not sidestepped. The first step in large projects is paving over the lower layer so that all that incidental friction, the kind AI can help with, is removed. If you are constantly going outside that paved area, sure AI will help, but not with the success of the project which is more contingent on the fact that you've failed to lay the groundwork correctly.
it's crazy that the experiences are still so wildly varying that we get people that use this strategy as a 'valid' gotcha.
AI works for the vast majority of nowhere-near-the-edge CS work -- you know, all the stuff the majority of people have to do every day.
I don't touch any kind of SQL manually anymore. I don't touch iptables or UFW. I don't touch polkit, dbus, or any other human-hostile IPC anymore. I don't write cron jobs, or system unit files. I query for documentation rather than slogging through a stupid web wiki or equivalent. a decent LLM model does it all with fairly easy 5-10 word prompts.
ever do real work with a mic and speech-to-text? It's 50x'd by LLM support. Gone are the days of saying "H T T P COLON FORWARD SLASH FORWARD SLASH W W W".
this isn't some untested frontier land anymore. People that embrace it find it really empowering except on the edges, and even those state-of-the-art edge people are using it to do the crap work.
This whole "Yeah, well let me see the proof!" ostrich-head-in-the-sand thing works about as long as it takes for everyone to make you eat their dust.
With good management you will get great work faster.
The distinguishing feature between corporations competing in the AI era is process. AI can automate a lot of the work but the human side owns process. If it’s no good everything collapses. Functional companies become hyper functional while dysfunctional companies will collapse.
This is also because bad commands used to be warded off by workers who in some shape or form of malicious compliance just would slow down and redirect the work while advocating for better solutions.
That can’t happen as much anymore as your manager or CEO can vibe code stuff and throw it down the pipeline for the workers to fix.
If you have bad processes your company will die, or shrivel or stagnate at best. Companies with good process will beat you.
This was possible before but someone would maybe notice the insane spaghetti. Now it's just "we'll fix it with another layer of noodles".
well, isn't that what AI can be used effectively for - to generate [auto]response to the AI generated content.
It's better than the "here's my code, it a giant pile of spaghetti but only luddites care about code quality and maintainability anyway" method, at least.
I wonder what I’m doing differently.
I did spend quite a bit of time, mostly manually, improving development processes such that the agent could effectively check its work. This made a difference between the agent mostly not working and mostly working. Maybe if I had instead spent gobs of money it would have worked output tooling improvements?
My hypothesis is that companies dont want to offer cheaper nor better services. Only want to cut costs and keep the revenue for investors.
I other news, TQQQ is pretty high!
And yet.. building shit is no longer the sole domain of the software engineer.
That's the sea change.
I've literally had finance and GTM stand things up for themselves in the last few weeks. A few tweaks (obviously around security and access), and they are good to go.
They've gone from wrangling spreadsheets to smooth automated workflows that allow them to work at a higher level in a matter of months.
That's what all this AI is doing. The shit we could never get the time to get around to doing.
The only thing that matters is the impact on the financials. The shareholders (the people who employ you) dont care about any of this if it does not enhance value.
And also because the Plan agent generates a huge plan, asks me a couple yes/no questions with an obvious answer, and then regenerates the entire plan again. Then the Build agent gets confused anyway and does something else, and I have to round-trip about 5 times with that full context each time.
Another project I'm seeing in the same realm is taking an approved protocol and some study results and checking that the records of what was done match what they said they could do in the approved protocol. It can also make sure that surgical records have all the things they should have. This can help meet one of the requirements from the national accreditation organization to do "post approval monitoring".
Another way I've used it is to have it collate and compare a particular kind of policy across many institutions who transparently put their policies online. Seeing the commonality between the policies and where some excel helped me rewrite our policy.
This is work that just wasn't happening before or, more accurately, it was being spread over lots of people, and any improvement in efficiency or consistency is hard to measure.
- Development velocity is very noticeably much higher across the board. Quality is not obviously worse, but it's LLM assisted, not vibe coding (except for experiments and internal tools).
- Things that would have been tactically built with TypeScript are now Rust apps.
- Things that would have been small Python scripts are full web apps and dashboards.
- Vibe coding (with Claude Desktop, nobody is using Replit or any of the others) is the new Excel for non tech people.
- Every time someone has any idea it's accompanied by a multi page "Clauded" memo explaining why it's a great idea and what exactly should be done (about 20% of which is useful).
- 80% of what were web searches now go to Claude instead (for at least a significant minority of people, could easily be over 50%).
- Nobody talks about ChatGPT any more. It's Claude or (sometimes) Gemini.
- My main job isn't writing code but I try to keep Claude Code (both my personal and corpo accounts) and OpenCode (also almost always Claude, via Copilot) busy and churning away on something as close to 100% of the time as I can without getting in the way of my other priorities.
We (~20 people) are probably using 2 orders of magnitude more inference than we were at the start of the year and it's consolidated away from cursor, ChatGPT and Claude to just be almost all Claude (plus a little Gemini as that's part of our Google Whateverspace plan and some people like it, mostly for non-engineering tasks).
No idea if any of this will make things better, exactly, but I think we'd be at a severe competitive disadvantage if we dropped it all and went back how things were.
It's an absolute tornado of PRs these days. Everyone making the most of these tools is effectively an engineering team lead.
I’m making a team version of my buildermark.dev open source project and trying to learn about how teams would like to use it.
That "more expensive" is someone's revenue. May be AI is the kind of technology that allows to make more and more revenue by making things more expensive and worse than by making them better and cheaper.
I agree about the core motivation behind these deals, however I'm skeptical as to how "suddenly" we'll see substantial improvements. Despite their size, I'd be surprised if Google or Amazon had uncommitted chunks of Anthropic-scale, top-tier AI compute sitting around waiting to be activated.
They're already over-subscribed and waiting for new data centers (and power plants) to come online. I suspect Anthropic will get a modest amount of new capacity right away with more added over coming quarters. These two deals don't change the total amount of AI compute available on planet Earth over the next 18 months. Anthropic parting with high-value equity has now made them the new highest bidder for an already over-bid resource. I suspect the net impact will be Amazon & Google pushing prices even higher on everyone else as they reallocate compute to their new top whale.
I doubt it was idle capacity. But for a chunk of equity in Anthropic I imagine they are willing to deprioritize other, possibly internal, uses. Certainly anything that's not contractually obligated could be on the chopping block.
But all progress points to a commodification of foundation models--Google first named it as "we have no moat, neither does anyone else." So there must be some secondary play driving this, right? Hardware sales? Hedging for search ad revenue?
Still feels mispriced. I think asset inflation leaves too much money desperate for the Next Big Thing.
I really couldn't have been more obscure, could I? :P
In 1932, "the first oil field in the Persian Gulf outside of Iran" was discovered in Bahrain [1]. (The same year Saudi Arabia announced unification [2].)
In the end, Saudi Arabia had larger reserves and wound up geopolitically dominating its first-moving rival. In commodities, the game tends to be scale in part through land grabbing. Less who got where first.
To close the analogy, if AI does wind up commoditised, the layers at which that commodity is held are probably between power and compute [3]. So if AI commoditises (commodifies?), Google selling computer (and indirectly power) to Anthropic and OpenAI is the smarter play than trying to advantage Gemini. (If AI doesn't commoditise, the opposite may be true–Google is supercharging a competitor.)
[1] https://en.wikipedia.org/wiki/Bahrain_Petroleum_Company
[2] https://en.wikipedia.org/wiki/Proclamation_of_the_Kingdom_of...
[3] The alternate hypothesis is it's at distribution.
This is why SpaceX could be a dark horse in this race. Putting compute in space is expensive but so is building a data center in the US.
You know what's also really hard in a vacuum? Dissipating heat.
Correct. The economics of space-based DCs comes down to permitting delays versus radiator mass.
At ISS-weight radiators (12 to 15 W/kg (EDIT: kg/kW)), you need almost decade-long delays on the ground (or 10+ percent interest rates) to make lifting worthwhile. Get down to current state-of-the-art in the 5 to 10 W/kg (EDIT: kg/kW) range, however, and you only need permiting delays of 2 to 3 years.
If there is a game-changing start-up waiting to be built, it's in someone commercialising a better vacuum-rated radiator.
Saudi will host the biggest data centers in the world
Although I doubt this will stop them if they think it’s advantageous…
Buwahahahahahahahhahah
They drop a little cash on some shitcoin the president controls and those problems go away.
US law here is nuanced. Good quick primer https://www.ftc.gov/advice-guidance/competition-guidance/gui...
As long it further's American interests globally - monopoly is fine. Other countries need to take notice and start picking winners nationally in order to compete with the large American big tech firms.
Airbus ?
lol
ed: @er2d, can't reply to your comment for some reason, so doing it here: I don't agree. In theory a monopoly decreases the necessity for R&D. Of course this becomes more complex if the R&D is funded or steered by the state. But look at the current state of LLMs. There is fierce competition between 3 US companies. But geopolitically it's the same as if there would be one monopoly. The US being the clear technological leader in an industry is not dependent on that industry being a domestic monopoly.
And for the Europe comment: Also don't agree. Look at Boeing & Airbus. Both are companies where the US & EU have decided that they need to ensure the existence of a domestic airplane manufacturer. So in these cases they support these companies (often in violation of international trade laws). But it has nothing to do with monopolies. If a state decides to support a company to ensure its existence, a monopoly is the logical consequence and not the aim. Because if that industry would be profitable it wouldn't need to be supported in the first place.
But all these tech companies are not in industries that would move off-shore or stop existing because they're not profitable enough, so it's an entirely different setting.
The US understands that and allows it to happen as the former yields a compounding effect of power.
European states certainly don't get this.
Now, that’s a name I haven’t heard in a long time.
Running at a loss long enough to kill the competition is basically the name of the game these days.
When Uber started, they were basically setting VC money on fire by selling rides at a loss to destroy the taxi market.
couldn't this just be framed / spun as just using search data as training? i don't seem being bundled enough to run afoul with anti-trust.
No doubt as of currently Google has a better business. But the same argument could have been said about Instagram or Whatsapp before Facebook (now Meta) acquired them.
> In September 2025, Google is in talks with several "neoclouds," including Crusoe and CoreWeave, about deploying TPU in their datacenter. In November 2025, Meta is in talks with Google to deploy TPUs in its AI datacenters.
Also those personalities, quirks and choices accumulate. A lot of people talk about using Claude Code and Codex for different things. This is 100% my experience. Some people make better models, but on the top 3, there are often differences that are fixed only by switching between them. If I feel the need to switch between them, then there are significant enough differences and those differences will accumulate.
if it runs of out of cash - then it's bad for the whole industry.
same as OpenAI. so all players - will provide cash & compute to keep them going.
Why? I don’t think we would suffer if anthropic disappeared tomorrow
And it may very well be bad news for OpenAI.
OpenAI crashing would be good news and bad news for Anthropic investors.
The drama on HN alone would last for days. Twitter would implode in on itself.
I have feeling that Dario is not the type of man who would want to be acquired and then have Google's CEO telling him what to do.
For example, you can buy KLM Air france for less than $3B.
It is a profitable business that does $30B in sales and $1B in profit. (and has been profitable since for the past 4-5 years)
This margin seems terrible.
That said, certain sectors like software (as in custom enterprise grade software dev) pull revenues that are much much higher sitting around 35%, but it's not that common.
[PDF] https://www.airfranceklm.com/sites/default/files/2026-02/202...
The amount of new revenue that I am personally able to create for my clients, using Claude models for dev, and Claude models inside the insanely agile products delivered, is astounding.
If I was not currently experiencing this myself, and someone told me that this was possible, I would be calling them names.
If we get to an end-state of monopoly/duopoly at this game, then we are truly screwed.
I was just stating my current use and revenue path. Anthropic has insane velocity, in April of 2026.
It's like insane hype marketing speak. "insanely agile products delivered" like huh?
I believe that I am more of an AI realist. The agentic dev tools are really helping me out, but if I could wave a magic wand to make AI go away for a hundred years, I would do it.
I really hope that we can all laugh at how wrong I was.
However, I believe that the horrors will likely outweigh the benefits. Our global society/political systems are not ready for Stasi as a Service, mass unemployment, or any of this impending crap storm.
Who could call me a starry-eyed idealist? I have invested in bunkers.
To the GP: I'd like some details of these "insanely agile products". Is this insane agility reflected by your customers saying that they have a better, faster, more reliable product? How are you measuring this?
I get that it's tedious to sit on tech forums listening to an endless stream of people insisting that suchandsuch technology is world-changing. Many people and probably most people who say that are wrong. But sometimes the world really does change.
Its just amazing people that people talk about Anthropic and have never used it.
Nah, see Meta
You'll notice that all the really big deals have fallen through, because they're based on promises and meeting objectives that can't be met. So it's likely that there will be really big writeoffs but not a huge implosion like 2001/2008. The real losers will be the retail investors who put all their money in a handful of stocks at ridiculous valuations.
"Disney cancels $1B deal with OpenAI after video platform Sora is shut down: 'The future is human'" https://finance.yahoo.com/sectors/technology/articles/disney...
And if I recall correctly the AI datacenter deal isn'tdoing Oracle stock any favours.
If you’re using it for personal work, why is $100 worth it?
I pay for my own AI provider subscriptions because keeping work and personal strictly separated is important for me. I do know some people who secretly pay $200/month for Claude and use it at their job even though it's not approved. I do not recommend doing that, but it shows that some people value this for their work.
For developers earning more than $10K per month, spending less than 1% of salary on tooling to make the job easier is easy to justify.
And with cashback through gcp usage!
Not sure if it’s going to be good enough to replace IDEs with neatly integrated superior models.
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 for goods they purchased for resale. This is effectively a loan that's backed by the retailer's ability to resell the goods. There's a possibility that the retailer goes broke and doesn't pay, but the vendor has insight into how well the retailer is doing, so they know if they're a good risk.
Similarly, Google likely knows quite a lot about Anthropic because Anthropic buys computing services from Google for resale. They're making an equity investment rather than a loan, but the money will be coming back to Google, assuming Anthropic's sales continue to rise as fast as they have been.
Also, if you own Google stock, some small part of that is an investment in Anthropic?
[1] https://www.anthropic.com/news/google-broadcom-partnership-c...
It’s concerning that the only thing that seems to be keeping the AI bubble inflated at this point is money from the folks selling things to AI companies. That’s very much not a good sign no matter how you spin it.
I’m a fan of AI and there’s clearly value to it… however that value seems completely out of whack with the money pumping into the ecosystem and at some point such irrational behaviors break.
I assume Anthropic said something like "We'll give you 3% of our company for $30B, since we're valued at $1T now! So cheap!", and Google immediately came back with "Hell no. We'll give you even more, $40B... but it's for 11% of the company. Take it or leave it." With all the issues they're having, what leverage does Anthropic have at that point?
Basically, Google made them an offer they couldn't refuse.
htrp•6h ago
How much of this goes back to Google as cloud spend?
dmk•6h ago