According to Nadella, Microsoft and OpenAI have a shared ambition to advance the research of AI to enable developers and organizations to build on the best AI infrastructure.
When OpenAI was established in December 2015, the initial idea was to be a non-profit organization focused on humanitarian welfare via AI advancement. However, the development of OpenAI LP, a capped-profit subsidiary that allowed investments from profitable organizations, significantly changed the entire dynamics. To date, Microsoft Corp (NASDAQ: MSFT) is the largest investor in OpenAI and its ChatGPT.
Notably, Microsoft poured in $1 billion to OpenAI LP as an initial investment back in 2019. At the beginning of 2023, Microsoft increased its investment in OpenAI LP by an additional $10 billion. In exchange, Microsoft is slated to access the most popular and advanced artificial intelligence for the development of its Azure supercomputer technology.
As a result, Tesla Inc (NASDAQ: TSLA) CEO Elon Musk recently noted that OpenAI and its products are heavily controlled by Microsoft.
“Microsoft has a very strong say, if not directly controls, OpenAI at this point,” Musk noted in an interview with CNBC.
Notably, Musk was among the 27,000 people to sign an open letter in March that intended to push for a pause in AI development.
Microsoft Deny Control of OpenAI and Its Products
The claims by Musk have, however, been discredited by Microsoft CEO Satya Nadella, who noted that they are ‘factually not correct’.
“Look, while I have a lot of respect for Elon and all that he does, I’d just say that’s factually not correct,” Nadella said. “OpenAI is very grounded in its mission of being controlled by a nonprofit board. We have a non-controlling interest in it, we have a great commercial partnership in it.”
In a recorded interview with CNBC, Nadella said that artificial intelligence (AI) is changing fast and Microsoft wants to be at the forefront to capitalize on the technology. On the bright side, Nadella noted that humans are in the loop of AI development.
“If anything, I feel, yes, it’s moving fast, but moving fast in the right direction. Humans are in the loop versus being out of the loop. It’s a design choice, which, at least, we have made,” Nadella said.
According to Nadella, Microsoft and OpenAI have a shared ambition to advance the research of artificial intelligence (AI) to enable developers and organizations to build on the best AI infrastructure. Furthermore, Microsoft has been building its Azure into an AI supercomputer since 2016.
Bigger Picture
The competition for artificial intelligence (AI) dominance in Silicon Valley has pushed most companies to the edge. Already, Alphabet Inc (NASDAQ: GOOGL) has narrowed down to AI development through its subsidiary Google LLC. As a result, Microsoft continues to use OpenAI to secure its future growth prospects.
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