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When it comes to generative artificial intelligence, companies in the tech industry face the eternal dilemma of whether to buy, partner, or build. This week, the spotlight is on acquisition. Databricks, a company specializing in data storage and management, acquired generative AI start-up MosaicML for $1.3 billion. MosaicML offers open-source versions of large-language models and provides tools for companies to utilize the technology internally.
In addition, Thomson Reuters announced a $650 million acquisition of Casetext, a 10-year-old AI company that expanded into generative AI this year. Casetext’s early partnership with an AI start-up allowed them to gain a head start in using the latest system, GPT-4, effectively. This acquisition emphasizes the growing importance of understanding and employing large-language models in the field of generative AI.
These recent acquisitions highlight the rapid expansion of opportunities in generative AI. While the focus initially centered around companies developing large-language models, attention has now shifted towards various technologies and the necessary expertise to leverage them. The value of companies capable of creating purpose-built models on demand or applying generative models to specific industries has skyrocketed.
Although acquisitions demonstrate the belief of many tech companies in the future impact of this technology, partnerships have been the primary focus. Salesforce, for example, doubled its investment in AI start-ups to $500 million and expressed plans to integrate generative AI into their products. Similarly, Oracle invested in large-model company Cohere and partnered closely with them to incorporate the technology into their own services.
While partnerships are a logical initial step, offering immediate access to important technology, the question remains whether big tech companies will be content with outsourcing their development as large-language models become integral to the future of technology. Microsoft, in particular, with its significant investment in OpenAI, faces the challenge of codependency, relying on another company for a core technology. The long-term stability of such a partnership is uncertain.
However, as the tech industry enthusiastically pursues this enticing new market, these considerations are often set aside for future evaluation.
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