Amazon offers free credits for startups to use AI models including Anthropic

Amazon Web Service (AWS) (AMZN.O) has expanded its free credits program for startups to cover the costs of using major AI models, the company told Reuters in an interview, as it looks to boost the market share of its AI platform Bedrock.

In a move to attract startup customers, Amazon now allows its cloud credits to cover the use of models from other providers including Anthropic, Meta, Mistral AI, and Cohere.

"This is another gift that we're making back to the startup ecosystem, in exchange for what we hope is startups continue to choose AWS as their first stop," said Howard Wright, vice president and global head of startups at AWS.

The move followed Amazon's now-completed $4 billion investment in Anthropic in convertible notes. As part of the deal, Anthropic will use AWS as its primary cloud provider, and Trainium and Inferentia chips to build and train its models.

Wright said Amazon's free credit will contribute to the revenue of Anthropic, one of the most popular models on Bedrock.

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"That's part of the ecosystem building. We are unapologetic about that," he said, adding that AWS offers a wide range of choices and security to startups.

Amazon said it has offered over $6 billion in credits to startups in the past decade.

In a partnership with Y Combinator, it's offering $500,000 in credits for the latest cohort launched in January, which can be used on AI models and Amazon's chips. The cost of using AI, based on usage, could pile up for startups.

Amazon is not alone among major cloud providers in providing free credits to lure AI startups. Microsoft Azure (MSFT.O) gives out credits that can be used for OpenAI's models, while Google's cloud credit can be applied for over 130 models on Vertex AI.

Big tech's investments in AI startups have drawn scrutiny from regulators, as the U.S. Federal Trade Commission (FTC) opened an inquiry on Microsoft's backing of OpenAI, as well as Google and Amazon's investment in Anthropic.