In response to heightened antitrust scrutiny from global regulators, both Microsoft and Apple have opted out of taking observer seats on OpenAI‘s board. Microsoft, a major investor with a $13 billion stake in the generative AI firm, announced its immediate withdrawal from the board in a letter to OpenAI. Apple, which was expected to assume a similar role as part of a deal to integrate OpenAI’s technologies into its devices, decided not to pursue the position, according to sources familiar with the matter.
Instead of board seats, OpenAI plans to engage with its strategic partners—including Microsoft and Apple—as well as investors like Thrive Capital and Khosla Ventures through regular meetings. This shift in approach coincides with the appointment of Sarah Friar, former Nextdoor CEO, as OpenAI’s first CFO last month.
The decision also comes amidst ongoing antitrust investigations in both the EU and US, which have raised concerns about competition in the AI sector. Microsoft, having initially accepted a non-voting role on OpenAI’s board after a turbulent period involving CEO Sam Altman’s temporary removal, stated that the role was no longer deemed necessary due to significant progress and improved governance.
Despite stepping back from board responsibilities, Microsoft reaffirmed its commitment to OpenAI as a key partner. The collaboration has been pivotal for OpenAI, leveraging Microsoft’s extensive computing infrastructure and cloud services worth billions. This partnership has also bolstered Microsoft’s position in the competitive generative AI landscape, driving accelerated growth in its Azure cloud platform sales.
While Microsoft does not hold traditional equity in OpenAI, its entitlement to a share of subsidiary profits underscores its strategic investment in the company. Both Microsoft and OpenAI emphasize that the latter remains an independent entity governed by its nonprofit structure, aiming to allay concerns amid escalating regulatory scrutiny.
The European Commission and the US Federal Trade Commission have intensified their scrutiny of tech giants’ investments in AI startups, signaling potential antitrust challenges ahead for companies like Microsoft, Amazon, and Google in this rapidly evolving sector.
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