The news: Amazon is in early talks to invest up to $10 billion in OpenAI, three sources told The Information. If finalized, the deal would value OpenAI at more than $500 billion and intensify Amazon’s competition with Microsoft in AI cloud services.

The investment, which follows November’s $38 billion deal between the companies, would bring OpenAI deeper into Amazon’s ecosystem to use Amazon’s Trainium chips to develop future AI products.

The rumored deal is the latest example of the AI industry’s self-funding loop, where Big Tech companies like Amazon, Microsoft, and Nvidia inject capital into startups that in turn buy back their chips or cloud capacity.

Why it’s worth watching: The news comes less than two months after OpenAI’s shift to a for-profit model, which lets it expand partnerships beyond Microsoft’s 27% share. It sets the tone for more spread-out AI hosting and product development, reducing reliance on Nvidia hardware and demonstrating how Amazon is now a key cog in the AI’s industry.

• Benefits for Amazon: Expansion. Combining OpenAI’s models and APIs with Amazon’s Trainium hardware will ensure future OpenAI products are trained and tuned for AWS clients, allowing Amazon to be at the center of AI development.
• Benefits for OpenAI: Diversification. OpenAI can expand compute access beyond Microsoft while distributing risk and deepening its hardware network. Working with Amazon, AMD, Broadcom, and others ensures it remains independent while tapping multiple supply chains for scale and performance gains.

What advertisers should expect: Consolidation means faster model updates, tighter cloud integrations, and more reliable access to genAI tools. Choosing the right AI tools and cloud providers now becomes a turnkey solution. 

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