Meta’s $14B Flex Could Cost Scale AI Its Biggest Client—Google

Following Meta’s huge investment in Scale AI could have some consequences. Google is allegedly planning to ditch Scale AI. As a reminder, Google is Scale AI’s biggest customer.

According to Reuters, Google had planned to pay Scale $200 million this year. Now, after Meta’s investment, Google is conversing with competitors, and is seemingly planning to cut ties with the company.

Microsoft could end up doing the same, and OpenAI supposedly made the same decision a month ago. It’s worth noting that OpenAI’s CFO did say that OpenAI will continue working with Scale, but things could have changed since then.

Google is Scale’s biggest client, and generative AI companies are, in general, the company’s biggest clients. However, Scale does worth with self-driving car companies and the US government as well.

In regards to generative AI companies, they are usually seeking access to workers with specialized knowledge, knowledge to annotate data to train models.

Reuters asked both Google and Scale to comment on the report. Google declined, while Scale did not directly comment on it, but the company said that its business remains strong. That doesn’t really say much, but there you go.

Scale’s spokesperson also said that the company will continue to operate as an independent company that safeguards its customers’ data. That was probably said due to Meta’s gigantic investment.

Meta now owns 49% of Scale

It is understandable that Meta’s investment scared a number of companies away, allegedly. Why? Well, Meta’s $14.3 investment managed to get it a 49% stake in the company. Scale’s CEO, Alexandr Wang, also joined Meta to lead the comapny’s efforts to develop “superintelligence.”

It is not difficult to see why Meta’s competitors want to look elsewhere at this point. Not only is the company’s CEO now a part of Meta’s execs, but Meta owns 49% of Scale.