Silicon Valley Is Searching for Its Piece of the AI Action

As OpenAI and Google announce a new round of advances, startups try to figure out where they fit in.

Illustration: Reya Ahmed for Bloomberg Businessweek

The 25 employees of San Francisco startup Atmo Inc. had every reason to be afraid. The four-year-old company takes atmospheric data from meteorological sensors and uses artificial intelligence to make weather predictions that it sells to customers such as the US Air Force and the Philippine government. Atmo says its AI tools generate weather forecasts that are more precise than those produced by crunching data on supercomputers, cost far less to use and can learn from past mistakes.

The startup seemed to have clear competitive skies—until March 29, when Alphabet Inc. published an academic paper titled “Generative AI to Quantify Uncertainty in Weather Forecasting” that described its own AI weather model, which it dubbed Seeds. Suddenly Atmo, which had raised a grand total of $11.2 million, was facing the prospect of competition from a $2 trillion behemoth with one of the largest AI operations in the world.