Microsoft drops $10 billion on OpenAI
MICROSOFT SEEMS to have retreated from the metaverse and is tightening its belt across the company, but one technology it is still backing is AI, having just invested $10 billion into OpenAI. This AI research laboratory is responsible for the amazing DALL-E, the image generator, and ChatGPT, a sophisticated chatbot that can do a lot more than just chat. These two projects captured the public’s imagination and helped push OpenAI’s valuation to $29bn. Microsoft has been working closely with OpenAI for a while and has already made two previous investments in the company.
Four years ago, Microsoft started work with OpenAI on the Azure OpenAI Service, which it has just made available, and is set to gain ChatGPT shortly. Now Microsoft is betting big enough for Wall Street analysts to take notice, causing a little spike in its stock price. This is now being seen as an opportunity for Microsoft to recapture some of its lost market share.
Microsoft’s CEO, Satya Nadella, said the company will be integrating OpenAI software into a range of Microsoft products, including Designer and Bing. This raises an intriguing question—could this put Bing back in contention as a search engine? Google dominates the market and has become synonymous with internet searching. If Microsoft can eat into that market share, it will affect Google’s revenue.
AI is huge and only getting bigger. DALL-E and ChatGPT are generative AI, producing content without human input. Pictures, video, audio, and text can all be easily created— some pundits predict that 90 percent of online content will be artificially created within three years. That sounds a lot, but the impact will no doubt be sizable. Microsoft has invested hugely in cloud services and now the AI to power it. This looks like a smart move.