Tensions rise in OpenAI-Microsoft partnership

New York — OpenAI executives have considered accusing Microsoft, the company’s major backer, of anticompetitive behaviour in their partnership, the Wall Street Journal reported on Monday, citing people familiar with the matter.

OpenAI’s effort could involve seeking a federal regulatory review of the terms of its contract with Microsoft for potential violations of antitrust law, as well as a public campaign, the report said.

Such a move could unravel one of the most pivotal tech partnerships in the fast-growing field of AI.

OpenAI needs Microsoft’s approval to complete its transition into a public-benefit corporation. But the two have not been able to agree on details even after months of negotiations, sources said.

The companies are discussing revising the terms of Microsoft’s investment, including the future equity stake it will hold in OpenAI, according to the sources.

Separately, The Information reported that OpenAI wants Microsoft to hold a 33% stake in a restructured unit in exchange for foregoing rights to future profits, citing a person who spoke to OpenAI executives.

The ChatGPT owner wants to modify existing clauses that give Microsoft exclusive rights to host OpenAI models in its cloud, the report added.

Microsoft has not agreed to OpenAI’s proposed terms and is reportedly seeking additional concessions from the start-up, according to The Information.

“Talks are ongoing and we are optimistic we will continue to build together for years to come,” the companies said in a joint statement.

Microsoft invested $1bn in OpenAI in 2019 to support the start-up’s development of AI technologies on its Azure cloud platform.

Since then, however, OpenAI has been looking for ways to reduce its reliance on the tech heavyweight. The company plans to add Alphabet’s Google Cloud service to meet its growing needs for computing capacity, Reuters reported earlier this month.

Reuters