Microsoft is expanding its commitment to OpenAI. The US software group announced a new multi-year, multi-billion dollar investment on Monday, without naming an exact amount. The business news service Bloomberg reported a sum of 10 billion US dollars that Microsoft wants to put into OpenAI. The open AI tool for artificial intelligence, ChatGPT, has been making waves since its launch in November and has sparked a new debate on the role of artificial intelligence (AI).
According to the Bloomberg report, a person familiar with the talks, who declined to be named because the information is not public, said the multi-year investment totaled $10 billion. There had already been rumors about the investment amount. According to Bloomberg, the sum would exceed all previous investments by Microsoft.
Win-win for Microsoft and OpenAI
Microsoft was an early OpenAI investor, investing $1 billion in the company in 2019. Further funds are said to have flowed later. Microsoft competes with corporations like Alphabet and Meta for the future market of artificial intelligence. The OpenAI deal will bolster Microsoft’s Azure cloud and provide OpenAI with additional purpose-built supercomputers to power its complex AI models and advance its research.
Because OpenAI needs Microsoft’s funding and cloud computing power to process the massive amounts of data and run the increasingly complex models that allow programs like DALL-E to generate realistic images based on a handful of words, or ChatGPT, amazingly profound to have conversations. The chat bot is able to respond to queries in a natural and human-like manner, carry on a conversation and answer follow-up questions – and could thus become a competitor to search engines like Google.
Deal for higher cloud computing power
As with Microsoft’s previous investment in OpenAI, much of the deal’s value will come from Microsoft providing OpenAI with the Azure cloud computing power needed to run its AI systems, according to Bloomberg, citing two with the deal familiar people.
Microsoft announced just a few days ago that ChatGPT will soon be available to customers of its own cloud service Azure. The service gives Microsoft’s cloud customers access to various OpenAI tools such as the GPT 3.5 voice system on which ChatGPT is based and the DALL-E model for generating images from text prompts. This enables Azure customers to use the OpenAI products in their own applications in the cloud.
Microsoft itself is currently using the AI developer language to automate its Copilot programming tool, and it also plans to integrate this technology into its Bing search engine, office productivity applications, Teams chat program and security software, Bloomberg writes.
Layoffs despite billions of investments
The news of the billion-euro investment comes less than a week after Microsoft announced massive job cuts. By the end of the quarter, 10,000 Microsoft employees will have to go. That is almost five percent of the total workforce.
Despite the layoffs, Microsoft wants to expand its gaming division. The group is currently trying to get antitrust approval for the $69 billion takeover of US video game manufacturer Activision Blizzard. The deal is still being examined by antitrust authorities, and the US authority FTC has decided to file a lawsuit. The EU is also threatening a cartel warning.
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