Openai is reducing its contract with Scale AI, a data label startup recently acquired by social media giant Meta.
According to a report from Bloomberg on Thursday, ChatGpt makers are reducing their reliance on startups' data just days after Meta announced a $14.8 billion deal for 49% ownership of Scale AI.
The acquisition is the second largest in the meta, and there is scale CEO Alexandr Wang, who will be taking part in Meta's experimental AI projects. The company announced its contract on June 12th.
Scale AI supplies labeled data used to train and improve artificial intelligence (AI) models. Founded in 2016 and backed by over 100 investors, the startup is a supplier of popular AI companies such as humanity, charcoal and mastery. According to Pitchbook, it raised $100 million in the 2019 Series C round.
Another company reportedly discontinuing the contract with Scale is Google. According to Reuters, the move is supported by concerns that the deal could provide meta-inspired insights into the AI development of competitors.
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An Openai spokesman told Bloomberg that the company has phased out its contract with Scale over the past year, seeking specialized data on AI models. The startup has explained a small portion of Openai's data needs.
In a statement on the contract, Scale's interim CEO Jason Doroge said the startup is “an independent company,” adding that “nothing has changed about our commitment to protecting customer data.”
Openai is currently betting on alternative data suppliers for operations, including new entrants in sectors such as Mercor.
Scale initially hired a “contractor's army” to label images and text from early AI systems over the past few years, according to Bloomberg. The company then moved to hiring more educated contractors to help develop sophisticated AI models.
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