Google might invest millions in Character.AI, nominee for best new Android app in 2023

Artificial intelligence is weaving its way into the realm of mobile tech, with almost everyone diving into AI development. Google is leading the charge with its latest Pixel 8 and Pixel 8 Pro, heavily infused with AI features. Samsung, gearing up for the upcoming Galaxy S24 series, is also making waves with its new AI model, Gauss.

Even Apple is joining the AI party, working on integrating generative AI into its iPhone 16 series. While on-device AI features are still in the works, AI-driven apps have been in the game for a while, and Google seems keen on investing in this arena.

According to Reuters, Google is in discussions to invest hundreds of millions of dollars in Character.AI, a rapidly growing AI chatbot startup. This move comes as Character.AI seeks capital to train models and meet the rising demand from users.

The potential investment, possibly structured as convertible notes, will further solidify the existing partnership between Character.AI and Google. The startup currently utilizes Google's cloud services and Tensor Processing Units (TPUs) for model training.

Character.AI, founded by former Google employees Noam Shazeer and Daniel De Freitas, offers users the ability to chat with virtual versions of celebrities like Cristiano Ronaldo or tech tycoons like Elon Musk and Bill Gates. Users can also create their own chatbots and AI assistants. While the service is free to use, it features a subscription model charging $9.99 per month for users wanting to skip the virtual line to access a chatbot.

The chatbots provided by Character.AI boast various roles and tones, attracting a significant user base aged 18 to 24, constituting about 60% of the website's traffic. This demographic positioning helps the company distinguish itself as a more entertaining and personalized AI companion compared to competitors like OpenAI's ChatGPT and Google's Bard. The startup claims to have garnered 100 million monthly visits to its website within the first six months since its launch.

Character.AI has also made waves in the app world, securing a nomination among the top 10 for Google Play Users’ Choice App of the Year. Voting continues until November 14, so if you want, you still have time to vote for your favorite app, game, or book on Google Play.