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OpenAI’s deal with Apple raises concerns at Microsoft and could change the dynamics of the AI market
OpenAI’s deal with Apple raises concerns at Microsoft and could change the dynamics of the AI market
Microsoft Corp. (NASDAQ:MSFT) is concerned about some of the OpenAI’s corporate business, particularly a potential agreement between OpenAI and Apple Inc. (NASDAQ:AAPL).
Satya Nadella recently met with the CEO of OpenAI Sam Altman to discuss this agreement involving the integration of OpenAI services into Apple products.
Nadella’s concerns stem from the potential impact on Microsoft’s product ambitions, Business Insider said reports.
Apple’s deal with OpenAI will solidify Altman’s control over the company following his brief dismissal last fall.
Altman, who ousted rivals from the board, seeks to replace Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:Google) Google as Apple’s research partner for Safari and building AI chip factories.
However, Microsoft, a significant investor in OpenAI, is concerned about the impact of the Apple deal on its own AI ambitions, according to the New York Post Office.
Apple considered Google and OpenAI for this multi-billion dollar deal.
If confirmed, this deal would be a significant victory for Altman, who has faced scrutiny from former employees and board members.
Tensions within OpenAI have been rising since Altman’s brief dismissal in November. A source revealed to The Financial Times that Microsoft pressured OpenAI to prioritize commercial products, exacerbating existing tensions between executives.
Despite these challenges, OpenAI’s valuation has soared to $90 billion since the launch of ChatGPT.
Altman is considering converting OpenAI into a for-profit corporation to attract significant capital and expand its AI infrastructure.
OpenAI’s annual revenue surpassed the US$2 billion mark. Parent company ChatGPT aims to double revenue by 2025.
Microsoft shares are up more than 26% over the past 12 months. Apple gained 8%.
Price Actions: MSFT shares traded up 0.06% at $414.93 in pre-market trading at last check Friday. AAPL fell 0.14% to $191.03.
Disclaimer: This content was produced in part with the help of AI tools and was reviewed and published by Benzinga editors.
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