Amazon and Samsung Enter AI Race. What It Means for Microsoft, Google and Apple.

The chief rival to their partnership so far has been Google-parent
Alphabet
(GOOGL), which developed an in-house AI model called PaLM that is now on its second version. Google was reported by The Wall Street Journal in July to be working on an AI model called Gemini that can rival GPT-4 and which is expected to be ready for release in the coming months.  

However, the race could be about to be blown open.
Amazon
(AMZN) is investing in its own AI model, code-named ‘
Olympus,
’ which could top both OpenAI and
Alphabet’s
technology, Reuters reported on Wednesday, citing people familiar with the matter.  

Amazon declined to comment on the report.

The company offers access to its Titan AI models and a range of others through Amazon Web Services. It has also agreed to invest up to $4 billion in AI start-up Anthropic, which will use Amazon Web Services in-house chips to build, train, and deploy its AI software.

In early treading, Amazon shares were down 0.3%. Microsoft and Alphabet were both up—0.7% and 0.2%, respectively.

Comparing AI models is tricky, as they can vary widely in their performance on different tasks. However, the most widely used metric is the number of parameters they have—a measure of the size and complexity of the model. 

Amazon’s Olympus is set to have two trillion parameters compared with a reported one trillion for GPT-4, according to Reuters. OpenAI hasn’t publicly disclosed GPT-4’s size or details of its training.  

Google’s original PaLM model had 540 billion parameters. Google has said its current version, PaLM 2, is smaller but more efficient. It’s a useful reminder that while the number of parameters is one way to measure model complexity, their performance also depends on speed and cost efficiency.

Amazon could upend the AI race in the U.S. but competition is also heating up internationally. South Korea’s
Samsung Electronics
(005930.Korea) unveiled its own AI model, named Gauss, on Wednesday at a company event. The company didn’t give technical details but said it could generate text, images and assist with coding. 

Samsung said Gauss is currently being used internally but it will expand it to several its products in the near future.

That raises the prospect of Samsung’s range of Galaxy smartphones having AI capabilities, bolstering its challenge to
Apple
(AAPL) and its iPhones. Korean media reported that Gauss AI could be integrated into the Galaxy S24 smartphone, expected to launch in January.

Apple
has been quiet about its own AI goals but is expected to spend billions on developing the technology, including a revamped version of its virtual assistant Siri.

Apple shares were up 0.8%. Samsung stock fell 1.4% in local trading in South Korea.

Write to Adam Clark at [email protected]