Key take aways:

 

• Microsoft Investment with the startup OpenAI, tech behind the chatbot sensation ChatGPT is spread across multiple years, with a commitment of multibillion dollars.

 

• The Investment marks the third phase of the partnership between the two organisations, following Microsoft's earlier investments in 2019 and 2021.

 

• Microsoft added that it extends our ongoing collaboration across AI supercomputing and research and enables each organisations to independently commercialize the resulting advanced AI technologies.

 

• Microsoft's Investment settles a stage with its arch rival Alphabet Inc. (NASDAQ: GOOGL) Google in its own turf search engine.

 

• This announcement came just before its Earning schedule on 24th January 2023.

 

• Last week's Microsoft layoff announced to reduce its global headcount by 10,000 employees and take a $1.2 billion charge related to the job cuts in its fiscal second quarter, which will impact the earnings by 12 cents per share.

 

 

Microsoft’s investment will also help the two companies engage in super computing at scale and creating new AI powered experiences,

 

 

Supercomputing at scale – Both the organisations are working together to build multiple supercomputing systems powered by Azure, which they will use to train all their models. Microsoft will increase their investment in these systems to accelerate OpenAI’s independent AI research. Azure will remain the exclusive cloud provider for all OpenAI workloads across all research, API and products.

 

New AI-powered experiences – Microsoft will deploy OpenAI’s models across its consumer and enterprise products and introduce new categories of digital experiences built on OpenAI’s technology. This includes Microsoft’s Azure OpenAI Service, which empowers developers to build cutting-edge AI applications through direct access to OpenAI models backed by Azure’s trusted, enterprise-grade capabilities and AI-optimized infrastructure and tools.

 

Exclusive cloud provider – As OpenAI’s exclusive cloud provider, Azure will power all OpenAI workloads across research, products and API services.

 

 

A Microsoft media spokesperson declined to reveal more on the exact scale of the Investment, media houses are building stories around the numbers. As the Investment is spread across multiple years, first task is to define the specific period and then to ascertain specific numbers from the company’s sources. Earnings Report might cast more light on this.

 

 

Microsoft is building on a big bet it made in July 2019 and 2021 in the startup, OpenAI co-founded by Elon Musk, Tesla & Space X's CEO and investor Sam Altman. Other co-founders of OpenAI includes Greg Brockman, Ilya Sutskever, Wojciech Zaremba and John Schulman. The group of founders pledged to invest over $ 1 billion into the venture when it launched. Microsoft's investment was timed post the resignation of Elon Musk from the board of OpenAI in February 2018 but Musk remained as a donor. 

 

Microsoft committed its investments $ 1 billion in OpenAI in 2019 to support OpenAI building artificial general intelligence (AGI) with widely distributed economic benefits. OpenAI partnered to develop a hardware and software platform within Microsoft Azure which has scaled to AGI. It was a joint development towards new Azure AI supercomputing technologies, and Microsoft become OpenAI’s exclusive cloud provider.

 

 

OpenAI built a supercomputer to power OpenAI’s technology and build several user cases and services around it which captured the imagination of digital savvy general public within and outside Silicon Valley and broken all the social media penetration records in the past in a shortest possible time.

 

 

Satya Nadella, Chairman and CEO, Microsoft. , said “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,” He added, “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.”

 

 

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

 

 

Microsoft has committed to building Azure into an AI supercomputer for the world, serving as the foundation of Microsoft vision to democratize AI as a platform. Through Microsoft initial investment and collaboration, Microsoft and OpenAI pushed the frontier of cloud supercomputing technology, announcing their first top-5 supercomputer in 2020, and subsequently constructing multiple AI supercomputing systems at massive scale. OpenAI has used this infrastructure to train its breakthrough models, which are now deployed in Azure to power category-defining AI products like GitHub Copilot, DALL·E 2 and ChatGPT.

 

These innovations have captured imaginations and introduced large-scale AI as a powerful, general-purpose technology platform that they believe will create transformative impacts at the magnitude of the personal computer, the internet, mobile devices and the cloud.

 

 

OpenAI.

 

OpenAI is an AI research and deployment company. OpenAI is formed with the mission to ensure that artificial general intelligence benefits all of humanity. OpenAI is a capped profit company and is governed by the OpenAI non-profit. OpenAI  Investors include Microsoft, Reid Hoffman’s charitable foundation and Khosla Ventures. Board comprised of Greg Brockman (Chairman & President), Ilya Sutskever (Chief Scientist), and Sam Altman (CEO).