Why Amazon is betting big on OpenAI and Anthropic at the same time

Amazon Web Services chief Matt Garman said Amazon’s $50 billion bet on OpenAI — on top of its earlier $8 billion investment in Anthropic — is the sort of overlap the company is comfortable navigating.Garman, who joined Amazon as an intern in 2005 before AWS launched a year later, was speaking at the HumanX conference in San Francisco.On the question of partnering with two competing AI firms, he said this isn’t new territory. AWS, he pointed out, has long operated in an ecosystem where it both collaborates with and competes against the same companies.In its early days, AWS accepted it couldn’t build every service itself and leaned on partnerships. At the same time, it understood those relationships would inevitably involve competition.Over the years, Garman said, AWS has developed a way of working with partners in the market while also offering its own rival products — without tilting the playing field in its favour.The AI sector is seeing similar patterns. When Anthropic raised $30 billion earlier this year, a number of its backers were also investors in OpenAI, including Microsoft, which is also OpenAI’s main cloud partner. At the same time, major cloud providers are rolling out AI model-routing tools that let customers switch between models depending on the task — using more advanced systems for complex work and cheaper ones for simpler jobs.