HomeWinBuzzer NewsMicrosoft Lists OpenAI as Competitor Amid AI and SearchGPT Expansion

Microsoft Lists OpenAI as Competitor Amid AI and SearchGPT Expansion

Microsoft may be a major multi-billion-dollar investor in OpenAI, but the new SearchGPT now pits the companies as rivals.

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Microsoft has incorporated OpenAI, a major partner and investment recipient, into its annual list of competitors following OpenAI’s announcement of its new search engine, SearchGPT.

Dynamics of the Microsoft-OpenAI Partnership

Despite an investment of $13 billion and a strong collaborative relationship, Microsoft now recognizes OpenAI as a rival in the fields of AI, search, and news advertising. The update, reflected in Microsoft’s 10K filing with the U.S. Securities and Exchange Commission, also mentions other tech giants like Amazon, Apple, Google, and Meta.

OpenAI’s unveiling of SearchGPT has intensified the competitive landscape. Although some companies leverage OpenAI’s models directly via Microsoft’s Azure OpenAI Service, Microsoft’s own AI assets, such as Copilot in Bing and Windows, compete in the same space. A spokesperson from OpenAI acknowledged that competition was expected but underlined the ongoing value in their collaboration with Microsoft.

Leadership Shifts and Strategic Adjustments

The past year has seen significant developments in the Microsoft-OpenAI relationship. Microsoft’s CEO, Satya Nadella, was not briefed about OpenAI’s board decision to remove CEO Sam Altman, who was later reinstated. Subsequently, OpenAI offered Microsoft a non-voting board position, which Microsoft recently chose to forgo.

In a strategic maneuver, Nadella designated Mustafa Suleyman, co-founder of DeepMind, as the CEO of Microsoft’s new AI division. Suleyman, along with his team from Inflection AI, joined Microsoft, signifying a strategic focus on enhancing AI capabilities.

Regulatory Examination

The U.S. Federal Trade Commission (FTC) is probing into the relationship between Microsoft and OpenAI, including similar investments by other cloud providers in AI startups. This examination might be influencing Microsoft’s stance on its relationship with OpenAI.

The evolving situation between Microsoft and OpenAI underscores the complexities inherent in partnerships within the fast-evolving AI sector. As both companies pursue innovation and growth in AI, the interplay between cooperation and competition will determine their future dealings.

One of the looming questions that has always hung over the relationship is why Microsoft has never bought OpenAI outright. There were times where the company has put billions of dollars into OpenAI, but has never seemingly sought an acquisition. With OpenAI’s revenue and value increasing, Microsoft’s decision may be permanent. 

ViaCNBC
Luke Jones
Luke Jones
Luke has been writing about Microsoft and the wider tech industry for over 10 years. With a degree in creative and professional writing, Luke looks for the interesting spin when covering AI, Windows, Xbox, and more.

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