Microsoft announces multi-billion dollar investment in OpenAI developer ChatGPT

Microsoft CEO Satya Nadella speaks at the company’s Ignite Spotlight event in Seoul on November 15, 2022.

SeongJoon Cho | Bloomberg | Getty Images

Microsoft announced a new multi-year, multibillion-dollar investment with ChatGPT maker OpenAI on Monday.

Microsoft declined to provide a specific dollar amount, but Semaphore reported earlier this month that Microsoft was in talks to invest as much as $10 billion.

The agreement marks the third phase of the partnership between the two companies, following Microsoft’s previous investments in 2019 and 2021. Microsoft said the renewed partnership will accelerate advances in AI and help both companies commercialize advanced technologies in the future.

“We formed our partnership with OpenAI around a shared ambition to responsibly advance cutting-edge AI research and democratize AI as a new technology platform,” Microsoft CEO Satya Nadella said in a statement.

OpenAI works closely with Microsoft’s Azure cloud service. In July 2019, Microsoft backed OpenAI with $1 billion, and the investment made Microsoft the “exclusive” cloud computing service provider for OpenAI. Microsoft said on Monday that Azure will continue to serve as the exclusive provider of OpenAI.

Microsoft’s investment will also help the two companies engage in supercomputing at scale and create new AI-based experiences, the statement said.

AI researchers rank OpenAI as one of the top three AI labs worldwide, and the company has developed AI gaming software that can beat humans in video games like Dota 2. However, it’s probably gotten more attention for its AI text generator GPT -3 and its unusual AI image generator Dall-E.

ChatGPT automatically generates text based on written instructions in a way that is much more advanced and creative than the chatbots of Silicon Valley’s past. The software debuted in late November and quickly became a viral sensation as tech executives and venture capitalists talked about it on Twitter, even comparing that is until Apple’s debut of the iPhone in 2007.

The technology has also caught the attention of Google executives, who said at a recent joint meeting that while it has similar AI capabilities, Google’s reputation could suffer if it moves too quickly on AI-chat technology.

The founders of OpenAI were Sam Altman, CEO of Tesla and SpaceX Elon Musk, Greg Brockman, Ilia Sutskever, Vojciech Zaremba and John Schulman. The group committed to investing over $1 billion in the venture when it was launched. Musk resigned from the board in February 2018, but remained a donor.

— CNBC’s Jonathan Vanian and Jennifer Elias contributed to this report

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