Google has reportedly invested $2.7 billion to facilitate the return of prominent artificial intelligence (AI) researcher Noam Shazeer, a move widely perceived as a strategic "acqui-hire" to bolster its AI capabilities. This substantial investment underscores the intense competition for top AI talent, leading some to observe that "labor [is] being priced like capital," as noted in a recent social media post by user "roon." While the tweet cited a "$3b" figure, official reports confirm the deal's value at $2.7 billion.
The agreement, formally a licensing deal for technology from Character.AI, the conversational AI startup co-founded by Shazeer, is primarily seen within the industry as a means to re-secure his expertise. Shazeer, a co-author of the influential 2017 paper "Attention Is All You Need" which laid foundational work for modern generative AI, left Google in 2021 to establish Character.AI. His startup quickly achieved a valuation of $1 billion, developing advanced chatbots.
Shazeer's return is a significant strategic win for Google, particularly as he is now reportedly leading efforts on Gemini, Google's next-generation AI technology. This move highlights Google's aggressive stance in the global AI race, aiming to integrate leading minds directly into its core development teams. The deal allows Google immediate access to Character.AI's intellectual property without the lengthy regulatory approvals typically associated with outright acquisitions.
The substantial sum paid for Shazeer's return reflects a broader trend in the AI sector where demand for skilled professionals far outstrips supply, driving up salaries and incentivizing unconventional talent acquisition methods. The AI talent market is characterized by high demand, limited supply, and intense competition, with some top AI professionals commanding salaries upwards of $300,000 annually. This environment pushes major tech companies to pursue deals that secure critical human capital, often blurring the lines between talent acquisition and traditional corporate mergers.
However, such high-value, talent-focused deals are drawing scrutiny from antitrust regulators. The U.S. Department of Justice is reportedly investigating Google's $2.7 billion agreement with Character.AI to determine if its structure circumvented regulatory oversight or potentially violated antitrust laws. This inquiry is part of a wider effort by the Federal Trade Commission (FTC) and the DOJ to examine investments and partnerships involving AI companies by large tech firms, addressing concerns that these arrangements could stifle competition and innovation in the burgeoning AI ecosystem.