Microsoft extends partnership with OpenAI by making a “multibillion dollar investment”

Earlier this month, it was rumored that Microsoft was intending to make a $10 billion dollar investment into OpenAI. And now, Microsoft has officially announced that it is extending its partnership with OpenAI through a multiyear, multibillion dollar investment.

The long-standing relationship dates back to 2019 when Microsoft injected a $1 billion investment into OpenAI in a bid to solve the world’s toughest problems, and also build upon the San Francisco-based company premise of using AI to benefit everyone.

According to Microsoft’s Chairman and CEO, Satya Nadella:

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. In this next phase of our partnership, developers and organizations across industries will have access to the best AI infrastructure, models, and toolchain with Azure to build and run their applications.

The extension of the partnership between both companies will result in an increase in the number of investments that Microsoft makes in “the development and deployment of specialized supercomputing systems to accelerate OpenAI’s groundbreaking independent AI research.”

Microsoft will incorporate AI-powered experiences across its products and services as well as launch new categories of digital experiences that rely on OpenAI’s technology including the Azure OpenAI Service. It was reported that Microsoft was planning to integrate ChatGPT capabilities across its Office Apps and launch a ChatGPT-powered Bing.

Through this deal, Azure will become OpenAI’s exclusive cloud provider. To this end, Microsoft is yet to indicate how much of an investment it has made. However, if earlier reports are anything to go by and no alterations have been made to the deal. Microsoft will get 75% of the profits made by OpenAI till it is able to get back the initial investment made, after which it would then retain a 49% stake in the company.

Sam Altman, CEO of OpenAI further added that “The past three years of our partnership have been great. Microsoft shares our values and we are excited to continue our independent research and work toward creating advanced AI that benefits everyone.”

Microsoft has constructed and trained multiple AI supercomputing systems using OpenAI’s technologies such as GitHub Copilot,  DALL·E 2, and ChatGPT. It will be interesting to see how Microsoft will integrate ChatGPT capabilities across its products and services, especially after announcing its massive planned layoffs which will take place over the next three months.