What's the Deal Between Microsoft and OpenAI

Match made in Heaven or Just a marriage of convenience?

In the dynamic and ever-changing landscape of today’s world there are only a few advancements that have managed to capture the global spotlight. However, the most significant buzz lately has undeniably been generated by the field of artificial intelligence (AI). AI goes through hype cycles every so often, but this time it looks like it’s not slowing down any time soon. AI has transformative potential has shattered traditional boundaries, which is unveiling a new realm of exploration and innovation.

While established industry leaders of the technology sector (Microsoft, Amazon and meta) have eagerly seized the opportunity to work with this new technology, it is the daring start-ups that have truly pushed the boundaries and garnered the most attention with their unique offerings. Midjourney and Stable Diffusion are just to name a few of these companies.

What is particularly thrilling is the synergistic combination of expertise and novel ideas from industry giants like Microsoft and pioneering trailblazers such as OpenAI. This collaboration holds the potential to shape a future that was once confined to our dreams. This is both very exciting and terrifying at the same time. Keeping up with this ever changing space is becoming quite exhausting especially at the speed things are improving.

Now, the question arises: “To what extent can they push the boundaries?” The answer lies in understanding the relationship between Microsoft and OpenAI. Big Money and Power meets innovation in the field of Machine Learning and Data science.

Let’s Take a Closer Look at the Relationship between Microsoft and OpenAI

OpenAI is a Non-profit company they are the company behind the world most advanced chat bot ChatGPT. They are not owned by Microsoft. They do however have a for-profit subsidiary corporation called OpenAI Limited Partnership. This subsidiary was created with one intention to obtain more capital. They imply they require this capital to ensure that they can build a safe AGI that will help benefit everyone.

Now, these two companies are closely connected. The board of directors consists of members of the original team over at OpenAI. This ensures that they have full control over any parties involved. This includes big companies like Microsoft. Some people say this good others say this is bad, only time will tell if it’s going to be a strong relationship over the years.

Microsoft, the largest tech giant on the plant owns a small part of OpenAI Global LLC this is the for-profit subsidiary, lost? yeah it’s a bit of a mouth full to take in, you would think OpenAI would have called their subsidiary “closedAI” or “paid4AI”. But nope.

Open AI Global LLC is basically a platform for ChatGPT to sell it’s products so it really has no direct influence over OpenAI as a hold. This means that Microsoft owns the rights to the products created for it.

We all need to be made aware that Microsoft didn’t announce its exact investment in OpenAI. There has been a lot of speculation around this and a lot of people consider it might have been %49 of the companies worth. Some suggest the spend was the sweet sum of $10bn, that’s a lot of money!

All we know is that Microsoft’s partnership with OpenAI is getting stronger. Let’s face it the both clearly can benefit each other. Microsoft gets access to this sweet new AI tech that it can implement into every part of it’s business where as OpenAI get’s access to the capital and computing power for its’s creations.

The only thing confirmed was their partnership is getting stronger, which is currently in its third year. It’s easy to see why, as the two benefit from each other. OpenAI receives the capital and computing power for its projects. On the other hand, Microsoft gets access to GPT-4 and integrates AI products into its search engine.

Two of the biggest products right now that Microsoft uses are Bing Chat that uses ChatGPT (prompt style chat bot) and Bing Image Creator that uses Dall-e-2 (generative AI tool). Not to mention all the other products Microsoft’s has in the works.

But it’s not all sweetness and light, there are some people that are not at all pleased with the relationship with OpenAI and Microsoft.

Elon Musk Questions the Microsoft-OpenAI Relationship

Elon musk is not please with this relationship

Is this all just a bitter argument or is their some home truths in what Musk has to say in regards to this so called “relationship”.

During a CNBC interview, Elon Musk candidly expressed his frustrations regarding the partnership between Microsoft and OpenAI. specifically focusing on issues related to control and structural changes within the company. However, his perspective represents only a portion of the overall narrative.

Musk’s discontent can be traced back to the early stages of OpenAI, where he asserts that his investment played a crucial role in the establishment of the start-up. He further claims credit for coining the name “OpenAI,” which symbolizes an open-source and non-profit model in direct contrast to Google’s closed-source and for-profit structure. This is where we can see a little bit of bitterness from musk. We can’t help but feel because he spun the term and was an initial investor then he has more say in the direction of the company.

While his concerns extend beyond the mere naming of this AI company, Musk’s disappointment primarily stems from the divergence of OpenAI’s original mission. He believes that the organization has deviated from its intended purpose, with Microsoft now exerting control over its operations. Which we personal believe is a valid point to make. The company its self does not come across as very “open”. We actually expected a name change at some point due to these changes within the company structure.

Several months ago, Musk voiced similar apprehensions, expressing regret for his involvement in founding the company. However, at this stage, there is no possibility of reversing the course of events. This was back when a lot of leaders within the tech space were calling on a stop to the creating of AI. We can’t help but think there might be some malicious behave in regards to this. But we do agree to some extent that we need to ensure that all safe practices are followed at all times and that nobody is harmed for the sake of progress.

In contrast, Satya Nadella, the CEO of Microsoft, refutes Musk’s allegations, denying any claims of Microsoft’s control over OpenAI. Which of course he would, this new form of AI technology could make them an absolute killing.

Conclusion

Look it’s rather complicated here. We believe the relationship between OpenAI and Microsoft is like a double edged sword at times. Sure it’s beneficial as it allows every day people to have access to these kind of great technologies but at what cost? In order to use Microsoft’s version of AI you will need to use Microsoft products. So it really does seem like a long term plan for them. They might not make money now on it but the possibilities in the future will be huge.

We are also not a big fan of the whole “closed” group that these two are part of. We prefer the whole AI space to be more open, so we are politely asking Microsoft and OpenAI to be more of that.

What do you lot think? are you happy with this match made in heaven or is there some kind of malicious involvement. Let us know in the comments below.