OpenAI executives weigh antitrust accusation against Microsoft
OpenAI executives have reportedly considered accusing Microsoft, their major backer, of anticompetitive behavior in their partnership, according to sources familiar with the matter as reported by the Wall Street Journal.
The efforts by OpenAI could potentially involve seeking a federal regulatory review of the terms of the contract with Microsoft for possible violations of antitrust laws, along with a public campaign as per the report.
This move could potentially impact one of the most critical tech partnerships in the rapidly expanding field of artificial intelligence. OpenAI is reliant on Microsoft's approval to finalize its transition into a public-benefit corporation. Despite months of negotiations, the two entities have not been able to reach an agreement on the specifics, sources revealed.
Renegotiating Investment Terms
The ongoing discussions between the companies are centered around revising the terms of Microsoft's investment, including the future equity stake it will possess in OpenAI, according to insider sources.
Additionally, The Information reported that OpenAI is pushing for Microsoft to hold a 33% stake in a restructured unit in exchange for relinquishing rights to potential future profits, based on insights from an individual who spoke with OpenAI executives.
OpenAI also aims to modify existing clauses that grant Microsoft exclusive rights to host OpenAI models in its cloud, the report further added. However, Microsoft has not yet accepted OpenAI's proposed terms and is purportedly seeking additional concessions from the startup.
Microsoft's Investment in OpenAI
In 2019, Microsoft made a significant $1 billion investment in OpenAI to aid the startup's advancement of AI technologies on its Azure cloud platform. Since then, OpenAI has been exploring ways to lessen its dependence on the tech giant. One of the strategies includes integrating Alphabet's Google Cloud service to address the escalating requirements for computing capacity, as reported by Reuters earlier this month.
