Anthropic Reportedly Negotiates $10 Billion Computing Power Partnership with Meta

According to reports, Anthropic is considering reaching a multi billion dollar computing power agreement with Meta, which could drive the latter’s ambition to surpass the social media field and enter the cloud business.

Sources told The New York Times and CNBC that this cutting-edge model developer is in early stage negotiations with Meta to acquire computing power, with a potential agreement value of around $10 billion.

This move comes at a time when Anthropic is searching for computing power to train and run its flagship Claude model. In May of this year, Anthropic signed an agreement with SpaceXAI to purchase 300MW of computing power for $1.25 billion per month, with the contract continuing until May 2029. In April, Anthropic also pledged to invest $100 billion over the next 10 years to acquire 5GW of computing power from AWS. Anthropic also has large-scale computing power agreements with Microsoft and Google.

Analysts previously told Fierce that providing bare metal computing power may be one of the ways Meta achieves success in the cloud market.

However, John Dinsdale, Chief Analyst at Synergy Research Group, told Fierce: ‘The main issues facing Meta are capability, credibility, and competitive positioning.’. He added that having a large amount of computing power does not necessarily translate into a successful cloud business, which requires providing services and supporting customers.

Dinsdale said, “Successfully operating cloud computing services requires a completely different set of skills and business models from leading social media companies.” He compared Meta’s actions to Google’s transformation from consumer market services to serving enterprise customers. Google has spent a long time building its organization and skills to achieve success in serving enterprise customers.

Urgent obstacles

In addition to the business aspect, Meta and the entire industry’s expansion ambitions also face another shadow.

According to Synergy Research Group, there are over 800 data centers under construction worldwide, with 437 planned to be built in the United States. However, data from state legislative conferences across the country shows that 15 states have proposed or passed suspension orders for data center construction due to citizen backlash and environmental concerns. A nationwide suspension order has also been proposed.

Although not all proposals will pass, Morningstar DBRS points out that these efforts may still affect financing considerations for data centers.

The Morningstar team wrote in a report to investors: “As states consider imposing new taxes, implementing restrictions and suspensions on data center growth, the escalation of stakeholder opposition may become a substantial credit factor, potentially weakening the credit quality of data center projects by reducing development visibility, increasing regulatory risk, and challenging assumptions about the speed and certainty of future AI driven capacity expansion. “

This is undoubtedly a big problem for a capital intensive industry, as even large-scale enterprises have to rely on debt and equity financing to support data center expansion.

According to reports, Meta is considering following the example of Alphabet, Oracle, and Amazon to raise billions of dollars in equity financing. However, Bloomberg pointed out that since the peak of the AI boom, the demand for bond issuance has significantly weakened.