Character.ai Shifts Strategy in AI Language Model Market Amid Competition

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Character.ai, an AI chatbot startup, has pivoted its strategy under the interim leadership of Dominic Pereira. The company has decided to step back from the intense competition in the large language model space, dominated by heavily-funded giants like Microsoft-backed OpenAI, Amazon, and Google.

Reports indicate that in August, Google hired 20% of Character.ai’s workforce to join its AI division, DeepMind. Additionally, Google spent $2.7 billion for a one-time license to use Character.ai’s model, although this deal does not cover future technological advancements.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.