OpenAI+Microsoft, a seemingly mismatched technological alliance

OpenAI and Microsoft - a star unicorn that controls the world's most advanced AI large model, and a technology giant with a market value of over $2 trillion - can be regarded as a model of mutual benefit in the technology industry today: Microsoft uses more than 10 billion dollars of investment to earn the opportunity to take the lead in the AI wave and the right to boast to investors; OpenAI, on the other hand, clings to Azure's thigh and is not worried about food and clothing in the big model race of burning money and computing power.

However, the latest report from the Wall Street Journal shows that the alliance between the two is far less sweet than it seems. Behind the cooperation between Microsoft and OpenAI, there are also subtle cracks and fissures.

Open Relationship: Choosing to be together, but you are not my only one

According to the Wall Street Journal's report on June 13th, the relationship between Microsoft and OpenAI is quite chaotic in the eyes of some customers who purchase GPT services.

The products they sell are similar, but the channels are different: Microsoft sells access to GPT technology through cloud service Azure, while OpenAI sells it directly.

Some companies told the Wall Street Journal that sometimes they just received sales pitches from the Azure team, and then OpenAI's sales would come knocking on the door, selling exactly the same thing, which was surprising.

At the same time, OpenAI even provides services to Microsoft's competitors. For example, the report mentioned that OpenAI customized a chatbot product named Einstein GPT for Microsoft's old rival Salesforce. Einstein GPT can automatically generate marketing emails, which is similar to the Viva Sales function developed by Microsoft GPT series large models.

In addition, while Microsoft is trying its best to compete with Google in the search engine market, OpenAI is secretly trying to trip up Microsoft. According to sources familiar with the matter cited by the Wall Street Journal, in the past 12 months, in addition to Microsoft's Bing, OpenAI has also contacted other search engine companies to discuss licensing issues for its products. In March, the search engine DuckDuckGo launched an AI search assistant called DuckAssist, which is powered by OpenAI's technology.

The Information previously reported that OpenAI sometimes withholds some advanced technologies, forcing customers to bypass Microsoft and obtain authorization from it. For example, on March 1st, OpenAI began selling the right to use its speech recognition model Whisper, but at that time, Azure's AI suite did not have this service yet; in addition, before the release of GPT-4, Duolingo and Stripe had already purchased the authorization for this technology from OpenAI, while Azure's customers had to wait in line. Between the two companies, this subtle tense situation can also be seen from the sales rhetoric. Internal Microsoft documents show that it requires salespeople to emphasize to customers that Azure can provide all the same features as OpenAI, and is more suitable for enterprise customers, while OpenAI's authorization has "limited enterprise features" and "less security/privacy features".

From the recruitment information, it is not difficult to see OpenAI's intentions. In June last year, OpenAI hired Aliisa Rosenthal, former vice president of WalkMe, as its sales director, and in February of this year, it hired James Dyett, former sales director of Stripe, as its strategic customer director.

This means that OpenAI is actively preparing to connect with large enterprise customers - which is exactly the territory of Microsoft Azure.

Marriage without intimacy: Microsoft holds only 49% of OpenAI shares to avoid antitrust review

The main reason why there is a hidden tense opposition between the two companies that are closely cooperating on the surface is the special cooperation relationship between OpenAI and Microsoft.

Since 2019, Microsoft has invested more than 10 billion US dollars in OpenAI and allows the latter to use the computing power provided by Azure for free. The condition is that before Microsoft's investment can be recovered, Microsoft enjoys 75% of OpenAI's profits and can obtain 49% of the subsequent profits within a certain upper limit.

On paper, this investment has brought rich returns to Microsoft: in the AI boom in the first half of the year, Microsoft's market value soared from 1.79 trillion US dollars at the end of 2022 to nearly 700 billion US dollars, to the current 2.48 trillion US dollars.

However, in fact, OpenAI's technology does not belong to Microsoft, and Microsoft does not have direct control over OpenAI.

According to the Wall Street Journal, in order to avoid antitrust review, Microsoft only holds 49% of OpenAI's shares. OpenAI almost operates independently. Only a few teams within Microsoft can access the core information such as the code library and model weights of the GPT series large models of OpenAI. For most Microsoft employees, OpenAI is no different from other external suppliers.

In the investment of large technology companies in startups, this situation is very rare. Generally speaking, after a large company acquires or invests in a startup, it will either fully integrate the two teams or completely absorb the technology of the latter. There are few companies like OpenAI that are invested in and compete with their own investors.

Microsoft Employees Question ChatGPT Stealing New Bing's Thunder, While OpenAI Once Suggested Microsoft to Launch New Bing Later

Even on the most core AI chatbot product, the two companies are not on the same page.

Last November, when OpenAI began publicly testing ChatGPT, the Microsoft team was still busy integrating GPT into the Bing search engine.

According to the Wall Street Journal, some Microsoft employees believe that OpenAI's release of ChatGPT was too early and would "steal New Bing's thunder."

When Microsoft officially launched New Bing this year, the OpenAI team suggested that Microsoft not rush to integrate GPT-4 and Bing. The OpenAI team pointed out that there are risks in integrating GPT-4 too early, such as inaccurate or strange responses.

Currently, New Bing has not achieved the same success as ChatGPT. According to analytics company YipitData, ChatGPT has reached 200 million monthly users, becoming one of the fastest-growing consumer applications in history; on desktop, ChatGPT's daily traffic is also twice that of Bing.