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This video by Cohere AI discusses word and sentence embeddings, which are essential for large language models. Language models aim to enable computers to understand and process human language, which consists of words, while computers operate with numbers. Word embeddings convert words into numerical representations, and sentence embeddings do the same for sentences. This process is not manually performed by humans; instead, it is executed by complex neural networks that analyze context. When words or sentences appear in similar contexts, their numerical representations are adjusted to be closer together. This method produces impressive results in language processing.