🤝 Amazon doubled down on AI

What’s going on here?

The US Treasury Secretary warned China against flooding the market with impossibly cheap clean energy products, nervous that a faster-than-expected green transition could leave stateside companies behind.

What does this mean?

China has been one of the biggest early investors in green energy technology. But now that high prices and interest rates have put folk and businesses off spending money, the country is left with more electric cars, lithium-ion batteries, and solar power systems that it knows what to do with. So instead of leaving them to collect dust, China’s been selling its electric goodies abroad for cheap, often for less than it cost to make them – a process called “dumping”. That gives shoppers some more wallet-friendly options, sure, but it also makes it impossible for the other global manufacturers to match those prices without losing money. The result: China pushes other countries out of major markets, distorting the going rate for a bunch of goods around the globe.

Why should I care?

Zooming out: Never mind the greater good.

The US government is throwing tax incentives and financial sweeteners at the stateside clean-tech industry, determined to cut the cord on Chinese supplies. Problem is, even Uncle Sam’s wallet can’t help US companies rival those chopped-down prices from China. So if the government’s slap on the wrist doesn’t stop the country’s dump-a-thon, the US might need to add tariffs to those imports, sacrificing the speed of the green transition to save face for American companies.

The bigger picture: An eye for an eye puts the whole world in a bind.

Any tariffs would be a lose-lose, really. In China’s case, fatter price tags would weigh on international sales, exactly the opposite of what the already struggling economy needs. And while tariffs could level the playing field for some US sectors, the move would risk putting shoppers off completely, supply chain slowdowns, and potential payback from China.

What’s going on here?

Amazon said it’ll top up its investment in AI startup Anthropic by $2.75 billion to make a total of $4 billion – the tech giant’s biggest private investment ever.

What does this mean?

Amazon wants to make Amazon Web Services (AWS) – the computing services division – the one-stop shop for developers and businesses. That’s why it plans to combine AWS’s data storage and processing services with tools like Anthropic’s Claude chatbot. It’s a bonus, of course, that the tech could tidy up Amazon’s own supply chain and robotics work. The deal’s sweet from Anthropic’s side, as well. The startup gets access to AWS’s cloud technology and AI chips, essentially everything it needs to build smarter models faster, along with major clout. The best bit: unlike Microsoft’s deal with OpenAI, Amazon and Anthropic’s partnership isn’t exclusive, so the startup can chat up suitors like Google Cloud, which is reportedly planning to invest $2 billion itself.

Why should I care?

For markets: The tortoise beats the hare in the 21st century, too.

Microsoft, Amazon, Facebook, Apple, and Google have made over 50 acquisitions and 124 investments in AI startups altogether. The industry is moving faster than ever, though, with regulatory risks rising, the costs of developments falling fast, and technology evolving at an unprecedented pace. So the challenge isn’t simply finding investments first, but sustaining that innovation and integrating AI effectively across an entire empire.

The bigger picture: The rich are getting richer.

Just remember, it wasn’t the biggest names in the early days of the internet – think Netscape and AOL – that became the richest. Instead, companies like Google and Amazon made their billions by creating new markets and business models from the developing technology. So if history repeats, as it tends to, some of the future’s household names will still be under the radar today, potentially tinkering away in fields like healthcare or biology.