The New $100M Anthropic Deal with SK Telecom Provides Insight into Where LLMs are Headed
The rise of industry-specific LLM offerings
SK Telecom announced a new $100 million investment in Anthropic along with a wide-ranging partnership to develop large language models (LLM) customized to the needs of the telecom industry. The new announcement suggests SK Telecom also participated in the May series C funding round, which totaled $450 million. A translation of the original news release states:
SKT decided on this large-scale investment following its Series C investment in Antropic in May. The two companies also plan to join forces to jointly develop a global telco multilingual LLM (LLM) and build an AI platform in the future. Along with the 'Global Telco AI Alliance' launched last month, this cooperation is expected to add strength to SKT's global AI competitiveness.
The two companies plan to jointly develop multilingual LLMs for global telecommunications companies, including Korean, English, German, Japanese, Arabic, and Spanish. SKT plans to further strengthen the performance of its own LLM, while expanding a new multilingual LLM model with Anthropic to demonstrate synergy of cooperation and self-reliance.
Global Telco AI Alliance
The recently formed Global Teleco AI Alliance is a joint initiative between SK Telecom, Deutsche Telekom, e&, and Singtel.
The four telcos will jointly develop the Telco AI Platform by combining their respective technologies and capabilities. The Telco AI Platform is expected to serve as the core foundation for new AI services, including those designed to improve the existing telco services, digital assistants, and super apps that offer a wide range of services.
The clear linkage between the funding round and the industry AI alliance suggests that Anthropic has been selected as a leading technology partner for the four Telco program. In addition to funding, Anthropic is picking up several high-profile telecom customers. You should expect these telcos to offer services that rely, at least in part, on Athropic’s technology. This could significantly expand Athropics’s reach into a wide variety of businesses.
Granted, we have seen similar initiatives during earlier technology platform shifts. Among the most notable were “net markets” formed by leading companies in a variety of industries, such as Covisint for automotive. The track record of these collaborations is mixed at best and it could be several years before we know the impact.
However, it is clearly a positive development. Landing any one of those telcos would be considered a big LLM win, especially with Google and Microsoft so active in the market. Anthropic will surely generate some revenue, prestige, and a lot of industry knowledge through the work, regardless of its long-term prospects.
Industry and Application-Specific LLMs
You have probably noted Synthedia’s thesis about industry specialization. Beyond two or three leading general-purpose LLMs, we expect other providers to develop specialized offerings related to professional functions or industries. Anthropic was already heading down the functional path with its focus on the industry’s largest context window that also operates with surprisingly low latency.
Anthropic CEO Dario Amodei commented that further specializations by industry are likely:
SKT has incredible ambitions to use AI to transform the telco industry. We’re excited to combine our AI expertise with SKT’s industry knowledge to build a LLM that is customized for telcos. We see industry specific LLMs as having high potential to create safer and more reliable deployments of AI technology.
At one point it looked like Anthropic might become Google’s back-up plan, when the Mountain View giant invested $300 million in the company with a directly competitive LLM product. However, Anthropic is executing a strategy that is beginning to look different than its tech giant rivals.
That strategy involves a lot of investment ($1.75 - $1.85 billion so far). It also appears to rest on product differentiation. How novel!
