Google Beats OpenAI, Secures Windsurf Technology, CEO And Key Staff For $2.4 Billion

Alphabet Inc.’s GOOG GOOGL Google has finalized a $2.4 billion agreement to license technology from AI coding startup Windsurf. This deal also includes hiring Windsurf’s CEO and a select group of its employees.What Happened: Google has reached a $2.4 billion deal with Windsurf, an AI coding startup, according to a report by The Wall Street Journal. The agreement involves licensing technology and hiring the company's CEO, Varun Mohan, cofounder Douglas Chen and some of the company's key R&D employees to bring them to the Google DeepMind team.This development comes after OpenAI attempted to acquire Windsurf for $3 billion. However, negotiations fell through due to objections from Microsoft MSFT, OpenAI’s largest investor, particularly concerning access to Windsurf’s technology.Subscribe to the Benzinga Tech Trends newsletter to get all the latest tech developments delivered to your inbox.Google’s arrangement will see a small number of Windsurf employees join its DeepMind division to work on agentic coding. The tech giant will gain a nonexclusive license to some of Windsurf's technology but will not acquire any equity in the startup. Most Windsurf employees will remain with the company.Why It Matters: The backdrop to this deal is a fierce competition among tech giants to dominate the AI landscape. Earlier this year, OpenAI had agreed to acquire Windsurf for $3 billion. However, the acquisition fell apart, as noted by TechCrunch, when Microsoft, a key investor in OpenAI, raised concerns about access to Windsurf’s technology.The failed acquisition attempt by OpenAI underscores the competitive nature of Silicon Valley, where major tech companies are in a race to secure top AI talent. Google previously invested $2.7 billion to hire former researcher Noam Shazeer and license technology from Character.AI, a startup he founded.Check out more of Benzinga’s Consumer Tech coverage by following this link. Elon Musk Rejects Reports That xAI Is Looking To Raise Additional Funds At $200 Billion Valuation: ‘We Have Plenty Of Capital’ Photo courtesy: JHVEPhoto / Shutterstock.com