Anthropic signs $30 billion deal with Amazon to deploy Claude on AWS — Nvidia and Microsoft jointly invest $15 billion into AI firm as it becomes first provider across Azure, AWS and Google

Another day, another landmark infrastructure deal between some of the world's largest tech companies. This time, it's Claude developer, Anthropic, which has struck a new partnership with Microsoft and Nvidia, as per the company's official blog. Anthropic will now use Microsoft's Azure servers to run Claude, purchasing $30 billion worth of server compute capacity over the coming years, with a pledge to help develop an additional gigawatt of compute using Nvidia Blackwell and Vera Rubin GPUs.

This deal will also see Nvidia and Anthropic work closely together to optimize future Nvidia architectures for better Claude performance and efficiency, and Anthropic models for Nvidia hardware.

Getting Claude on Azure also makes it more widely available. Various Claude models will be available to Microsoft Foundry customers, making it easier for businesses to access Anthropic AI. It will also be accessible through Copilot in GitHub, Copilot Studio, and Microsoft 365.

Although this is a big win for all the companies involved, it's arguably Anthropic's big coming-out party. It's now the only major AI developer where Claude runs on all the big-three cloud platforms - Azure, AWS, and Google Cloud. The companies are also becoming ever more intertwined, with Microsoft and Nvidia jointly investing $15 billion in Anthropic.

In the wake of the deal's announcement, Anthropic's valuation is now thought to be around $350 billion, close to double its September valuation of $183 billion.

This further circularizes the AI industry, making all these companies even more interdependent. It's not that the industry is too big to fail; it's the threat that if any of them do, they might take all of the others with them.

Hedging all the bets

Microsoft was an early investor in Anthropic rival and ChatGPT developer, OpenAI, and it doubled down on that earlier this year when it restructured its working relationship deal with OpenAI, taking an ownership stake while retaining access to its model data. Now, it's heavily invested in Anthropic and its Claude AI platform, which competes directly with OpenAI.

Although that might create conflicts of interest, Microsoft seems keen to back every horse it can, so that whoever ends up making the best models, Microsoft is there to take advantage regardless.

In that, it has a clear partner in Nvidia. Although Nvidia isn't quite as directly invested in AI transforming Windows 11, it does want the AI demand to continue apace. At this time, Nvidia is arguably one of the few companies that has directly earned any material profit from AI. Everyone else is spending, investing, and building out the infrastructure they claim they need, not to be left behind by the competition.

Nvidia is selling all the hardware for that, and with its plans for an annual upgrade cycle for data center products, it needs the companies doing the buying to stay afloat, too.

That's why it's investing in OpenAI, xAI, CoreWeave, Nebius Group, ARM Holdings, and a range of other companies building AI-first products and services.

With Nvidia's massive $4 trillion+ valuation and enormous orders on the books from every tech and AI firm out there, it's investing a lot of its profit back into the industry that powers it, ensuring its ongoing development even as warnings of a bubble continue to loom.

Microsoft is doing something very similar, and CEO Satya Nadella even alluded to that in his public discussion of the Anthropic deal.

“As an industry, we really need to move beyond any type of zero-sum narrative or winner-take-all hype,” he said, via CNBC.

“What’s required now is the hard work of building broad, durable capabilities together so that this technology can deliver real, tangible local success for every country, every sector, and every customer. The opportunity is simply too big to approach any other way.”

This too-interconnected-to-fail model was parroted by Google CEO, Sundar Pinchai just a few days ago too.

"No firm is going to be immune," if AI companies overinvest, he said.

AI is a flat circle

Anthropic made clear in its public statements about the deal that even with Microsoft and Nvidia's new investment, it's still an Amazon company at heart. Anthropic named Amazon's AWS cloud as its primary cloud provider in 2023 and its primary AI training partner in 2024. That's not going to change, it said.

But Amazon is looking elsewhere, too. Amazon struck a deal with OpenAI just a few weeks ago, where the AI developer would purchase $38 billion worth of compute on AWS servers to expand OpenAI services. Amazon will reportedly give OpenAI access to hundreds of thousands of chips in its EC2 UltraServers, scaling to "tens of millions" of CPUs in due time.

Everyone is invested in or has contracts with just about everyone else in the industry, and this latest Anthropic deal just cements that even further. It feels more notable since it comes in the wake of increasing concerns from analysts and financial leaders that the AI industry is looking increasingly like a bubble.

But valuations appear to reward it, regardless. Despite Anthropic announcing a $50 billion commitment with Fluidstack just a few days ago, and now another $30 billion with Microsoft, its stock is now worth almost $170 billion more than it was before all the announcements, which could be enough to secure further financing.

How much road that gives them while they and everyone like them tries to figure out the business model for AI, remains to be seen.

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