Amazon just put another $5 billion into Anthropic, the company behind Claude AI that competes with ChatGPT. In return, Anthropic promised to spend $100 billion on Amazon’s cloud services over time.
This looks like Amazon paying itself. The company gives Anthropic money, then gets most of it back when Anthropic buys cloud computing power from Amazon Web Services.
The Ultimate Business Boomerang
Amazon has now invested $8 billion total in Anthropic since last year. But here’s the twist – Anthropic agreed to make Amazon its “primary cloud provider” and spend that massive $100 billion on AWS services. It’s like lending your friend money to buy groceries at your own store.
This deal helps Amazon compete with Microsoft, which famously invested $13 billion in OpenAI (the ChatGPT company). Both tech giants are racing to control the AI boom by funding the hottest AI startups, then requiring those startups to use their cloud services.
For Anthropic, this means guaranteed funding to build better AI models and compete with OpenAI. For Amazon, it means keeping a major AI player tied to AWS while potentially getting most of its investment back through cloud bills.
Expect more of these circular deals as Google, Microsoft, and Amazon fight over AI dominance. The message is clear: if you want billions in funding, you better promise to spend it right back on the investor’s other services.
