Google is preparing to end its partnership with Scale AI, a leading company specialising in human-labelled data essential for training artificial intelligence systems, following Meta’s recent acquisition of a substantial stake in the firm.
Insiders reveal that Google, once Scale AI’s largest client, had intended to invest approximately $200 million in 2025 for data annotation services that support its advanced AI projects, including Gemini—Google’s competitor to OpenAI’s ChatGPT. However, after Meta purchased a 49% share in Scale AI, valued at around $29 billion, Google has started seeking alternative providers to replace much of the work currently handled by Scale.
This move by Google is mirrored by other major technology companies. Microsoft and Elon Musk’s xAI are reportedly scaling back their use of Scale AI, while OpenAI reduced its engagement several months ago but continues to utilise Scale as one of several data suppliers. The primary concern among these firms is the risk of sharing proprietary research and product developments with a company now partly owned by a direct competitor. With Meta’s ownership, rivals worry that sensitive information related to their AI development could be unintentionally exposed.
Scale AI’s business model centres on offering generative AI developers access to a specialised workforce of annotators, including experts with advanced degrees in disciplines such as history and science. These annotators label complex datasets crucial for refining AI models after initial training, with some individual annotations costing up to $100.
In 2024, Scale AI generated roughly $870 million in revenue, with Google alone accounting for nearly $150 million of that total. The company also serves clients in autonomous vehicle technology and government sectors, but the bulk of its income derives from generative AI enterprises.
Despite these changes, Scale AI plans to continue operating independently. Its CEO, Alexandr Wang, along with a select team, will join Meta to lead initiatives that aim to develop “superintelligence.” A spokesperson for Scale AI emphasised the company’s commitment to stringent data protection and declined to comment on the specifics of its relationship with Google.