Leonidas, had six-pack or not, he died at Thermopylae, but what is curious for our history is exactly what happened afterwards. Xerxes’ Persians had devastated Attica, and faced with the threat that all of Greece would fall, the Spartans—who deeply distrusted the Athenians—agreed to join forces with them. War makes strange allies, they say, and this story is not even close to explaining what is happening with AI. Everyone is joining forces. Then I’ll tell you how it ended with the Spartans and the Athenians.
what has happened. OpenAI is negotiating an alliance with Amazon according to which the latter would invest around $10 billion in OpenAI. In The Information They were the first to reveal that negotiation, now confirmed by sources close to the conversations that have been cited on CNBC.
What do each other gain?. Thanks to this agreement, Amazon will sell OpenAI its Tranium chips and will also rent more computing capacity in its data centers so that OpenAI can further expand the execution of its AI models and services such as ChatGPT. What OpenAI gains is, once again, economic resources to continue growing. Or what is the same: money to burn on that bonfire that AI has become.
A strange agreement. The alliance is surprising, especially considering that Amazon had already put its eggs in another basket. Specifically, Anthropic, OpenAI’s absolute rival in the AI race. It is estimated that Amazon has invested a total of 8 billion dollars at Anthropic, but now there is another reality: that everyone invests in everyone.
Anthropic, the best example. The truth is that in recent months we have seen more and more circular financing agreements. Microsoft, which had invested 13 billion dollars, announced last month that would invest $5 billion in Anthropic, and NVIDIA also signed up, doubling that amount: it will invest $10 billion in it. And already, Even Google has teamed up with Anthropic.
Long live circular financing. But of course the main protagonist of these agreements is OpenAI, which has been receiving blank checks (or almost) from giants like NVIDIA —100,000 million-, with Broadcom or with amd. We are facing a gigantic house of cards which is in danger of collapsing. But while it doesn’t, players continue adding floors. Or what is the same, money.
Win-Win? The agreement is certainly interesting for Amazon, which has been working on its own AI chips since 2015. Trainium are the latest expression of that effort, and the fact that OpenAI is going to use them to train its models—along with those of its competitors, for the record—is good support for that development. In fact, there was perhaps more interesting support recently for those chips: Apple’s.
And of course, AWS. In reality, this agreement is a continuation of that (temporary?) love affair between Amazon and OpenAI. The latter, once its ties with Microsoft were released, began to look for new girlfriends in the field of infrastructure, and a little over a month ago announced an agreement with Amazon Web Services worth 38 billion dollars.
This is about preservation. All these agreements between big technology companies are not about money, because these circular investments are nothing more than exchanges of kind that compensate each other. What they are about is being stronger and protecting themselves. And if they fall, yes, they will all fall together.
Let’s go back to Greece. The alliance between Sparta and Greece crystallized in the naval battle of Salamis (also in 480 BC, shortly after Thermopylae), one of the most important in human history. Sparta reluctantly ceded naval command to Athens, but the strategy worked. That union of forces achieved a decisive victory that saved Greece from being conquered by Persia.
Alliances that end as they end. After that battle and that of Plataea a year later, the alliance began to deteriorate and ended up breaking up. Athens and Sparta were enemies again. In fact, 50 years later (430 BC) both would face each other for more than a quarter of a century in the Peloponnesian War. It was totally logical, as it will be that all these alliances end as they should: with each company going about its own thing.
Image | OpenAI
In Xataka | NVIDIA and OpenAI have just made a masterstroke. One that strengthens them and weakens everyone else
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