Meta Platforms (NASDAQ: META) plans to make a huge investment into a relatively new AI platform. Much of AI is relatively new, and its technology is not yet entirely proven. In the AI arms race among mega tech companies, Meta may not have a choice. It needs to keep up with the industry.
Key Points
-
Meta Is Making AI Investment
-
ScaleAI Is A Key Industry Player
-
Take this quiz to see if you’re on track to retire. (sponsored)
According to Bloomberg, the company is called ScaleAI. “Scale AI, whose customers include Microsoft Corp. and OpenAI, provides data labeling services to help companies train machine-learning models and has become a key beneficiary of the generative AI boom.” It does give Meta an inside track on two of its competitors.
The AI investment plans of the largest tech companies. Meta is talking about $65 billion. Amazon (NASDAQ: AMZN) and Microsoft (NASDAQ: MSFT) are closer to $50 billion. OpenAI is in the same neighborhood. Elon Musk’s XAI has already opened a huge facility in Tennessee.
The challenge that Meta has is access to energy. Meta has signed a $10 billion deal with utility Constellation Energy (NYSE: CEG) to provide eclectic power. However, former Google CEO Eric Schmidt thinks that 99% of the electricity generated in the US over the next decade may be used for AI.
ScaleAI is more than energy play, according to Bloomberg. “Scale plays a key role in making AI data available for companies. Because AI is only as good as the data that goes into it, Scale uses scads of contract workers to tidy up and tag images, text and other data that can then be used for AI training.”
One lesson from the news about the investment is that it involves humans. AI has not taken every function in the industry yet.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
