AWS CEO Matt Garman said Amazon’s recent $50 billion investment in OpenAI, after its long partnership including $8 billion of investment in Anthropic, is the type of conflict of interest the cloud giant is used to handling.

Garman has worked at Amazon since he was a business school intern in 2005, before the launch of AWS in 2006, he told the audience of the HumanX conference taking place this week in San Francisco.

When asked about the inherent conflict of working closely with two AI model companies that are fierce (and, arguably, sometimes petty) competitors, he said it’s not a problem. Because AWS itself often competes with its partners, it has a lot of direct experience with such competition, he explained.

In AWS’s earliest years, it knew it couldn’t build every cloud offering itself, so the unit partnered with others.

“We also knew that we would have to compete with our partners, because technology is interconnected,” Garman recounted. “So, for a very long time, we’ve built this muscle up of how we go to market with our partners,” he continued. “But we also may even have first-party products that compete with them, and that’s okay, and we’ve promised them we won’t give ourselves unfair competitive advantage.”

Today, the world is used to Amazon competing with those who sell on its cloud. Even one of AWS’s biggest rivals, Oracle, sells its database and other services on AWS. But it was a radical idea back in 2006, when technology partners took pains never to compete with the partners that helped them succeed.

Still, Amazon is hardly a trailblazer in discarding investor loyalty and conflict-of-interest commitments in the wild, money-grabbing world of AI. When Anthropic announced its latest $30 billion round in February, it included at least a dozen investors who were also backing OpenAI. This included OpenAI’s main cloud partner, Microsoft.

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For AWS, making a huge investment in OpenAI to gain its model for its customers (and as a technology development partner) was almost a matter of life and death. Both models were already available on Microsoft’s cloud, AWS’s biggest rival.

The cloud giants are also working to keep themselves front and center by offering AI model-routing services. Those services allow their customers to automatically use different models for various tasks as a way to maximize performance and reduce costs. As Garman explained, one model might be ideal for planning, another for reasoning, and a cheaper model for easier tasks, like code completion. “I think that is where the world will go,” Garman said.

That is also how Amazon, and Microsoft for that matter, will slip their own homegrown models into usage — that old competing-with-your-partners situation, again.

All’s fair in love and AI these days.

Topics

AI, Anthropic, AWS, Enterprise, Matt Garman, OpenAI, TC

Julie Bort

Venture Editor

Julie Bort is the Startups/Venture Desk editor for TechCrunch.

You can contact or verify outreach from Julie by emailing julie.bort@techcrunch.com or via @Julie188 on X.

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AWS boss explains why investing billions in both Anthropic and OpenAI is an OK conflict